Most toddlers' fears are predictable and serve to keep them safe. Many children this age are scared of loud noises, large crowds, new people, and even things that to an adult seem perfectly benign — like a petting zoo.
Respect your child's feelings. Encourage him to try new things by watching his reaction to new experiences and following his lead. Stay close all the time. For example, if you see someone walking a dog, ask the owner if it's safe to pet the pooch. Then take your child's hand in yours and show him how to approach the animal. If he's reluctant, back off. Forcing him to face an unfamiliar situation before he's ready will increase his wariness and shake his trust in you.
Children don't learn when they're scared. When he's relaxed and free from pressure, your toddler will watch your reaction to a strange situation and, eventually, take his cue from you. So show your own enthusiasm, and support your child's advances. Allow him time to take stock of each new situation, and be there to show him the way.