The narratives studied by schema-based models or story grammars are generally simpler than those found in literary texts, such as short stones or novels. Literary narratives are indeterminate, exhibiting conflicts between schemata and frequent ambiguities in the status of narrative elements. An account of the process of comprehending such complex narratives is beyond the reach of purely cognitive models. It is argued that during comprehension response is controlled by affect, which directs the creation of schemata more adequate to the text. (...) Several properties of affect that make it appropriate for this model of narrative are discussed. A short story by Virginia Woolf is analysed in the light of the proposed model. A study with readers of the story is described, which illustrates the process of schema formation: Shifts in the relative importance of story phrases across the reading and the comments made by readers point to a process of schema creation under the control of affect. It is argued that affect may play a more productive role in cognitive processes than is generally acknowledged. (shrink)