The history of the short story in mid-twentieth century America continues to be marked by a tension between the twin fictional poles of realism and romance, the story of accurate ‘reportage’ and the story of fantasy and imagination. The short story also encourages, and can accommodate in particular ways, a reflexive self-consciousness about literary form, a propensity to build into the story a commentary on itself. The closeness of the typical length of the short story to that of the essay, and the relationship of story to essay through the sketch, which shares features of both, also influences the short story's tendency towards self-reflection and a mingling of genres and registers.

In the twentieth century we can see the beginnings of an anti-realist playfulness in O. Henry. Sherwood Anderson's stories often accentuate the grotesque beyond the boundaries of realist report. Flannery O'Connor's tales, for all their compelling realism of detail and surface, relentlessly press their plots and characters towards the extreme revelations of transcendent parable. One of the most famous New Yorker stories by Shirley Jackson, ‘The Lottery’, is a tour de force of bland suburban realism suddenly shifting almost imperceptibly into an enigmatic fantasy in which social orthodoxy involves inhuman sacrificial violence. As we have seen, even a chronicler of contemporary suburban mores like Cheever often allows his imagination to lift his stories beyond the everyday into regions that border the surreal.