Titus Groan by Mervyn Peake: Not much happens, but what does happen shakes an empire and is written in a prose beautifully translating the author's artist's (painter, illustrator) perceptions into language.
Jonathan Strange & Mr. Norrell by Susannah Clarke: Historical fantasy written deftly and with a light touch, as when a character transported by a fairy to a dour and barren land asks if it is the fairy's realm and the fairy responds that it is Scotland. The story is engrossing and the footnotes are marvelous fun.
"The Last Flight of Dr. Ain" and "The Screwfly Solution" by James Tiptree, Jr.: Writing that feels written on the brink of hysteria, these two stories are among the most frightening s.f. I've read, and more effective as such than most novels.
"The Homecoming" by Ray Bradbury: Transcendent prose using the furniture of horror and fantasy -- vampires, spirit travel, mummies, a man with wings -- to tell a story of a young boy inescapably an outsider to the family he loves and of the love they have for this poor, limited mortal.
"The Adder" by Fred Chappell: Lovecraft-inspired, Chappell cleverly plays with lines from Milton's Paradise Lost; funny until it's not and then it's chilling.
The Red Tree by Caitlin Kiernan: One of the best uses of the unreliable narrator I've encountered. Sarah Crowe is unstable and aware of it. How much her instability is her mind and how much the old house she rents is up to the reader to determine.
Randy M.