A novella is longer. The extra length is generally used for more character development than is possible in a short story, but without the much greater character and plot development of a novel
Supplement from 11/13/2006 12:52pm:
Determining what exactly separates a short story from longer fictional formats is problematic. A classic definition of a short story is that it must be able to be read in one sitting (a point most notably made in Edgar Allan Poe's essay "The Philosophy of Composition" of 1846). Other definitions place the maximum word length at 7,500 words. In contemporary usage, the term short story most often refers to a work of fiction no longer than 20,000 words and no shorter than 1,000.
Stories shorter than 1,000 words fall into the flash fiction genre. Fiction surpassing the maximum word length parameters of the short story falls into the areas of novelettes, novellas, or novels.
All from my good friend Mr W Iki.
