Pay attention to the news. Watch TV talk shows. These media outlets are breeding grounds for story ideas. Keep notes on anything that sounds promising.
Watch the people around you. Pay particular attention to facial expressions, dialect, physical character traits, and the way different people interact with one another. It won't take long to build an encyclopedia of characters to draw from whenever you need one.
Write your story based on facts, but remember, the object is to fictionalize the story. This involves taking creative license. A story doesn't have to be written exactly as it happened, and in most cases, it shouldn't be. You need to follow the basics of story plot and structure, so you will be re-working events to fit within the scope of the story you're telling. The real event is only the basis for the story. Just because an event or series of events happened a certain way, that doesn't mean those events have to be written that way. Arrange the events in the order that best suits your story.
Do not use real names. Use composite character traits to create fictional characters from the real characters. If possible, reverse the sex of the characters. If using a real person is essential to telling your story, make sure you contact the person in question and look for permission. If what you intend to write about them is a matter of public knowledge and not defamatory, you might be able to include them without consent. Still, if at all possible, avoid this route.
Develop a backstory for the characters in the real-life event. They are real people, but your goal is to turn them into fictional characters in a story. It's important that you develop them the same as you would any fictional character.
If telling the story requires you to stick so closely to the real story that you may hurt some of the people involved, seek permission from the involved parties ahead of time. If possible, interview some of the real people to gain a wider perspective of the story you're writing. The more you know about the actual events and background leading to the events, the easier it will be to turn nonfiction into fiction that people will enjoy reading.