How did 20th-century short story writers shift from dramatic events to psychological conflict?

In the 20th century, short story writers shifted away from the 19th-century reliance on unique, dramatic events and plot-driven structures, favoring instead a focus on subtle actions and psychological conflict.1

This evolution occurred as writers began to prioritize "form" over traditional plot, which many early 20th-century authors, such as Sherwood Anderson, felt constrained the creative process. As the century progressed, spectacular and suspenseful action was increasingly rejected, partly because visual media like film and television could depict such events more vividly.1

Consequently, writers began structuring narratives around the internal states of their characters. In works by authors like Ernest Hemingway, D.H. Lawrence, and Katherine Mansfield, physical events became secondary, serving only to reveal the psychological underpinnings of the story. This shift allowed for greater experimentation with organic forms, motifs, and archetypal models, enabling the short story to become a more complex and intellectually demanding genre.1