O. Henry stories are famous for their surprise endings. He was called the American Guy De Maupassant. Both authors wrote twist endings, but O. Henry stories were much more playful and optimistic.

Most of O. Henry's stories are set in his own time, the early years of the 20th century. Many take place in New York City, and deal for the most part with ordinary people: clerks, policemen, waitresses. His stories are also well known for witty narration.

Fundamentally a product of his time, O. Henry's work provides one of the best English examples of catching the entire flavor of an age. Whether roaming the cattle-lands of Texas, exploring the art of the "gentle grafter", or investigating the tensions of class and wealth in turn-of-the-century New York, O. Henry had an inimitable hand for isolating some element of society and describing it with an incredible economy and grace of language. Some of his best and least-known work resides in the collection Cabbages and Kings, a series of stories which each explore some individual aspect of life in a paralytically sleepy Central American town while each advancing some aspect of the larger plot and relating back one to another in a complex structure which slowly explicates its own background even as it painstakingly erects a town which is one of the most detailed literary creations of the period.

The Four Million (a collection of stories) opens with a reference to Ward McAllister's "assertion that there were only 'Four Hundred' people in New York City who were really worth noticing. But a wiser man has arisen—the census taker—and his larger estimate of human interest has been preferred in marking out the field of these little stories of the 'Four Million'". To O. Henry, everyone in New York counted. He had an obvious affection for the city, which he called "Bagdad-on-the-Subway,"[1] and many of his stories are set there—but others are set in small towns and in other cities.
"A Municipal Report" opens by quoting Frank Norris: "Fancy a novel about Chicago or Buffalo, let us say, or Nashville, Tennessee! There are just three big cities in the United States that are 'story cities'—New York, of course, New Orleans, and, best of the lot, San Francisco." Thumbing his nose at Norris, O. Henry sets the story in Nashville.
"The Gift of the Magi" concerns a young couple who are short of money but desperately want to buy each other Christmas gifts. Unbeknownst to Jim, Della sells her most valuable possession, her beautiful hair, in order to buy a platinum fob chain for Jim's watch; unbeknownst to Della, Jim sells his most valuable possession, his watch, to buy jeweled combs for Della's hair. The essential premise of this story has been copied, re-worked, parodied, and otherwise re-told countless times in the century since it was written.
"The Ransom of Red Chief" concerns two men who kidnap a boy of ten. The boy turns out to be so bratty and obnoxious that the desperate men ultimately pay the boy's father two hundred and fifty dollars to take him back.
"The Cop and the Anthem" concerns a New York City hobo named Soapy, who sets out to get arrested so he can spend the cold winter as a guest of the city jail. Despite efforts at petty theft, vandalism, disorderly conduct, and "mashing", Soapy fails to draw the attention of the police. Disconsolate, he pauses in front of a church, where an organ anthem inspires him to clean up his life—whereupon he is promptly arrested for loitering.
"A Retrieved Reformation" has safecracker Jimmy Valentine take a job in a small-town bank in order to case it for a planned robbery. Unexpectedly, he falls in love with the banker's daughter, and decides to go straight. Just as he's about to leave to deliver his specialized tools to an old associate, a lawman who recognizes him arrives at the bank, and a child locks herself in the airtight vault. Knowing it will seal his fate, Valentine cracks open the safe to rescue the child—and the lawman lets him go.
"Compliments of the Season" describes several characters' misadventures during Christmas .

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