Start with a well-researched true story.
Create the plot. A fiction story has a specific plot structure that holds a reader's attention. Your story must fit this structure. For instance, your lead character must be shown to be living a normal life when something happens to pull him or her away from that life. There must be an object of desire the lead character wants, and obstacles placed in his or her path. There must be a moment when it seems all is lost, a resolution and a denouement, when things return to normal.
Flesh out your characters. Even non-fiction characters can be flat and unappealing if not written correctly. You must show their personalities and motivations, moments of indecision and temptations that lead them astray.
Work on setting. Your setting is a real place; your job is to bring the reader there. Describe the season, the traffic noise, the sterility of the office or the smells from the corner deli.
Decide on a point of view. Which character or characters will tell the story? How much will they know? Do you need a narrator?
Add literary touches. Give some thought to things like theme, symbolism, style and irony.
Review your finished story and make sure everything is true. If you added a character, made up dialogue or described events that never took place, you've moved away from literary non-fiction to fiction based on fact.