You write a short story or novel and it falls flat; it's lifeless, and you wonder why the images and the story plot are not bouncing off the pages and standing as three-dimensional icons. Well, maybe the setting in your story or novel is lacking.
Your story has to happen:
1. In a Place (even if it's all in the main character's imagination, it's still a place!)
2. In a time period or era (or a certain time in the main character's life)
3. In an environment (even if you want to create an imaginary forest)
4. In a duration of time (the amount of time passing from the beginning to the end of the story)
Now that you have the basics down, work details into the place/setting that you have created to enhance the mood of your story. Do research if you must (especially when writing period pieces) to help flesh out your story, giving the reader good juicy details they can sink their reading tentacles in.
One way of further enhancing the mood is by developing the narrative through descriptive writing of the environment including your immediate surroundings. In other words, to bring more life into your story, it is important to give sufficient details.
The movie, A Beautiful Mind illustrates this perfectly. It is the true story about John Nash (played by Russell Crowe), the brilliant professor of Mathematics and his work at Princeton University and later at MIT in 1947 (Place and Time). The movie highlighted his years as a professor (Time Duration) and during this time a lot happened: he was invited to the Pentagon to crack encrypted codes from the enemy; he fell in love with a student; he witnessed a shootout and feared for his life (Creating Environments).
What's beautiful about this movie is that the writers used a variety of settings to create a gripping story. The events in the movie were real for the main character, but in reality some of it took place in his mind (John Nash suffered from hallucinations). The scenes that were in his mind were just as real as the ones in real life. Nash's senses were attuned to even the imaginary scenes- he could smell, taste, touch, and see everything that happened to him, real or imaginary.
We should do the same when we're writing. Be descriptive enough and create an imaginary world that causes the reader's senses to become attuned to what's happening in the story.
Good luck and happy writing!