Brainstorm for a story idea. In general, stories with broad themes won't work as well as those taking place in a short period of time and those involving only two or three characters.
Write the story without worrying about the word count. Make sure that it has all the necessary story elements.
Start cutting. Delete every adjective and adverb. Make the verbs specific. Reword the sentences to make them shorter. Cut dialogue down to only what's needed to further the plot. Take out every word that's not essential to the story.
Start in the middle. Try going directly to the action and cut everything that comes before that point.
Ask yourself what the reader absolutely needs to know. For instance, if the setting is a desert, the reader doesn't need to know which desert or what variety of cactus grows there. Make further cuts in the description of characters, background information and stage direction.
Make the story ambiguous. The fun of reading flash fiction is that each person sees something different. Is the story about a lost love, a beloved first car or a runaway pet? Allow for more than one interpretation and people will read your story again and again.