I'm rewriting an historical short story that I started when I was sixteen. It was a project for my eleventh-grade English class, and later I revised it for my senior portfolio. In college, I revised it even further for my 400-level creative writing course.
Even though it's only existed in short story form, I always intended it to be a novel. Now that I've been away from it for about a year, though, I can see that it will work best as a short story. Oh, sure, I could stretch it into a full book if I wanted. Those extra pages would mean more space for historical world-building. But it takes place during a very well-known time period (the Holocaust), so world-building can and probably should be kept to a minimum.
I used to think that I could never write a successful short story because I write historical fiction and it would be just too hard to establish a detailed setting and a plot in 5000 words or less. But now I think the real challenge is exactly the opposite: what is the least amount of world-building you can do and still immerse your reader in a convincing setting with a great plot?
It's not about how much you can write, but how little. If you take up a lot of space establishing the time and place, the reader will get bored waiting for the plot to start. If you jump right in and fling a bunch of obscure details at your reader as you go along, she'll get frustrated because she can't understand the context. I read a story like this recently. The plot was good, but I couldn't focus on it because I spent half the story figuring out that it was set in 12th-century southwestern Europe.
As I revise I've noticed this is a problem with my own story. I can see why some members of my critique group were uncertain of the setting for the first two or three pages. I was trying to be subtle, but I was too subtle. The characters and their relationships also need to be clearer. The version I'm working off of is about 4900 words. I'm giving myself a limit of 5000 words. No matter what, I need to get both the plot and the world in there. That means adding some things, sharpening and expanding certain details. But that also means cutting words as I go along, eliminating anything that isn't necessary. A snip here, a snip there. And in doing so I'm freeing up space for my characters to flourish and their story to grow.