Fiction is largely defined as writing that is not based on fact or reality, though it may and often does contain elements of both. Merriam-Webster Online defines fiction as "something invented by the imagination or feigned." In terms of writing, this can be extended to include all writing that is presented as containing events and details that exist only in the realm of imagination, and it does not include writing presented as factual or having actually occurred. Poetry, plays, non-documentary and non-"reality" television shows and films, and most novels and short stories fall within the category of fiction.
Nonfiction writing is considered that which presents events and facts as having actually occurred. Merriam-Webster Online defines nonfiction as "literature or cinema that is not fictional." A common mistake about nonfiction is that writing written as nonfiction must contain only true statements, but this is not the case. For a work to be classified as nonfiction, it must simply be believed to be true by the writer at the moment of writing and whether or not it is actually true does not matter. Works that fall within the category of nonfiction include television and newspaper reports -- as well as other news items -- biographies, histories, text and reference books, documentaries and personal accounts.
Past saying simply fiction is not real and nonfiction is, there are a few more specific distinctions between the fiction and nonfiction writing styles. For instance, while fiction is largely set within the realm of the imagination, the setting, characters and details of fiction writing can sometimes be entirely based in fact. For instance, historical fiction is a genre which sets fictional accounts of events within a historically accurate setting. The difference between this kind of writing and nonfiction is where nonfiction only gives factual accounts of events, fiction can use factual details to create non-factual, or fictional, accounts. Nonfiction, on the other hand, can contain fiction as well. This can occur when a writer attempts to write a nonfictional piece, but has information that is not factual or is interpreted incorrectly. Additionally, there is a kind of nonfiction writing called the personal essay which deals with mostly factual accounts, though they may be presented in a way that is not completely factual. For instance, a personal essay could tell a story about a person's life, but for the sake of the writing, the events may be rearranged into a different order than that which factually occurred.
Some examples of pure fictional writing include "The Lord of the Rings" series by J.R.R. Tolkien, "Robinson Crusoe" by Daniel Defoe and "Neuromancer" by William Gibson. Examples of fiction based on nonfictional facts, but still is based in fictional universes, include "Cryptonomicon" by Neal Stephenson, "The Great War" trilogy by Harry Turtledove and "All Quiet on the Western Front" by Erich Maria Remarque. Nonfiction writing examples include news articles by papers such as the "New York Times," science writing such as "A Brief History of Time" by Stephen Hawking and biographies such as "Lincoln the Unknown" by Dale Carnegie. A good example of nonfictional work that includes an element of fiction would be the Kentucky Derby essay by Hunter S. Thompson.