Is the story you want to tell one best told in short form or in the long novel form, or perhaps the tweener, a novella? Generally speaking, this decision will be mostly intuitive, but it will also be influenced by what you want to do with it.
I am a novelist of mysteries. I prefer that length because it provides the room to flesh out characters and build plot. The novel provides the space to salt real clues that point the discerning reader toward the antagonist, while also scattering about a few red herrings designed to have the reader believe someone else is the dastardly villain, perhaps the butler, only to later learn the butler had been the only honorable character in the story.
I write short stories for one of two primary reasons: I post short stories to the blog page on my website, to illustrate my writing skills with the hope readers will choose to graduate to one of my novels. I also write short stories to train myself to write leaner, that is, to trim off the fat of excess words that fails to advance the story. We have all read fiction where we skip ahead a paragraph or more to advance our reading past whatever element of the story the author has overwritten. Descriptions of people, places, and things need to paint a word picture that allows the reader to see those elements of the story, and to invoke the reader’s senses. At the same time, these descriptions and backstory must be kept short enough to hold the reader’s interest. This principle increases in importance as that person, place or thing decreases in importance. The reader does not need to know about the round white aphids on the full abundant verdant rose leaves, if only the red rose bush is integral to the story.
I set up parameters for short stories before I begin to write, imagining them as training exercises. This forces me to trim off the word-fat as I write and edit. For example, I once wrote a three sentence description of a female director of the U.S. Central Intelligence Agency, and then shortened it thus: she had the look of a librarian and the heart of a cobra. Lean. The readers then interpret, subconsciously perhaps, their take on the look of a librarian and the absence of a caring heart in a cobra.
An example of this lean style can be found in personal blog post. Before beginning that short, The Bijou, I set these parameters: not to exceed 500 words about a woman alone in a closed and boarded up movie theater. My first draft had 610 words, my final edition 499. I cut out nothing, just trimmed the word-fat out of the sentences.
How do I use this “leanness” when writing novels? Novels are long-form fiction and whether a given book totals 60,000 or 90,000 words alone does not say the story missed its mark. However, this length freedom often leads to: twelve words instead of ten in the previous sentence—so what? Two sentences about something that does not advance the story or endear the character to the reader—so what? Too much of that sort of thing causes yawns, and, if it continues, will lead to that novel becoming a wall-banger, just before the reader reaches for an alternative novel. So, I like to write lean, or perhaps I should say leaner. Some fat enhances the flavor, but too much ruins the taste for the all important reader.