John Lehmann’s The Penguin New Writing (1940-1950) is considered one of the finest literary periodicals of World War Two. The journal was committed to publishing writing about all aspects of wartime life, from the front lines to daily civilian struggles, by writers from around the world. It had an engaged readership and a high circulation. This chapter specifically considers Lehmann’s contribution to the wartime heyday for the short story form, through the example of The Penguin New Writing. By examining Lehmann’s editorial approach this chapter reveals the ways he actively engaged with his contributors, teasing and coaxing short stories out of them and contrasts this with the editorial style of Cyril Connolly at rival Horizon magazine. Stories by, and Lehmann’s interactions with, established writers such as Elizabeth Bowen, Henry Green and Rosamond Lehmann, the emerging writer William Sansom and working-class writers B.L Coombs and Jim Phelan, are the main focus of this chapter. The international outlook of the journal, which promoted satire from China alongside short, mocking works by Graham Greene, is also evaluated as an often overlooked aspect of Lehmann’s venture. Through the short stories and Lehmann’s editorials, this chapter traces how Lehmann sought to shape literature and to elevate the short story form. The chapter concludes by considering how the decline of the short story form in Britain from the 1950s onwards was closely linked to the demise of the magazines which had most actively supported it.