First of all, forget about creating a story on your own. It's not going to work in a rpg and lead almost always to a frustrated DM (they destroyed my story), frustrated player(he's railroaded us) or both.
It's based on action and reaction. It's all about situations. You present a situation, the PC's react to it (sometimes by saying we're not interested). Then the gameworld and NPC's involved in the situation react to the PC's (even if they wheren't interested-the world moves on. Great example-in Piratecats game the PC's didn't care for the March of Modrons adventures-As a result the plane of mechanus more or less colapsed). The PC's react to that and so it goes on.
This provides the players with the tools to create their own story. This means that, with good preparation and some thinking on the foot, you're never caught of guard and their players will really be able to play how they want to.
Now, there's basically five basic techniques how you as a DM can ensure that the adventures that evolve this way are interesting: Involvement, pacing, twists, consistency and excitement.
Involvement is important for players and PC's. The players will be much more engaged when the situation play to their plans and their PC's abilities. Likewhise, things are much more interesting if the PC's themself are somehow involved. This doesn't mean the PC's have to always be personally involved (after the x'ed threatened relative/friend they'll only be paranoid). But play to the players and PC's schticks and hooks. Some players really take to this and will create such an amount of agendas for his PC's that you have little work creating situations on your own, others won't care much and simply tag along with the rest. That's ok, people want different things from the game.
Pacing is one of the most important and hardest thing for a DM to do. Pacing is the skill of driving things along and providing clues at exactly the right rate. Pacing is deciding when things have to go in a fast tempo and when things have to slow down. As DM it's your responsebility to move the story along when it threatens to screech to a halt and to slow the players down when they rush to much. If you pace to fast the players will feel rushed or lost, get overwhelmed by information or feel railroaded, with new things happening all the time, pressing them into constant action. If the pacing is to slow players get frustrated with the lack of clues, the amount of time simple things take, that nothing ever gets to the point or they feel left in the waste. To fast pacing makes player's heads spin, to slow gets them boored and both frustrate them. The bad thing about pacing is how hard it is to learn. It is something that has to be done completely on feeling. While some take better to it than others (I'm pretty bad) trial and error is the key. With patience and practice pacing can be learned.
Twists are what makes stories interesting and gives them depth. A situation will be simple, maybe even unoriginal or clichee, but with enough twists and added layers even the simple "goblin raiders" will make for a great story. Every answer leads to new questions. To (roughly) quote the author of the original dungeoncraft articles this will make your game seem like a soap opera, but these shows have appeal for a reason (By the way those articles are an excellent recourse, but I don't have link. Hopefully someone can burry them up?). Again, not all players will jump to this as the one reason why a story is great, but enough will and the others will be interested thanks to the other techniques.
Consistency is of prime importance for the action/reaction system and for suspension of disbelief. Where story twists are the element of surprise/unpredictability in your story, consistency is the predictable foundation it has to be based on. If your players can't tell how their choice of action will impact the game world they will feel just as powerless as if they didn't have a choice to beginn with and the whole point to the system is lost. That doesn't mean everything should always play out like the players expect, but there should be a certain mechanism to the way your world reacts and once there has been a certain reaction in the world, don't have the world react completely differently the next time a simmilar situation comes up unless there's a good in game reason. Consistency also ensures that the world seems like a real world to help suspension of disbelief. Consistency means you always have a reason why thinks happen the way they do and why NPC's behave the way they do. Consistency lends credibility to the created story and like twists, adds a layer of depth. Consistency is also the ratbastard element (really all of these are, but consistency is the hallmarc of RBDMing). Good consistency combined with the other elements will leave your PC's collective asses get kicked by their actions regularly in such an exciting way that they'll love you for it.
Lastly exitement brings us the hollywood effect. You know how a totally bland movie can have us totally entranced because of the coolness and exploding things (for example the skull island passage of the new King Kong) and how very deep and inteligent films can leave even an intelectual yarning? A good film has both depth and explosions and the same is true for gaming stories. This involves exciting combats and game mechanics. But also such thing as awesome window dressing (The villains homebase isn't some castle, it's a bloodstone tower on the highest mountain in the middle of a desert surrounded by eternal frost). The rule for excitement is whatever is the most fun/awesome thing that could happen from this action is happening. Sometimes it's even justified to sacrifice RAW or some minor point of consistency to excitement in favor of the PC's, but be carefull with that. While there's a huge crowd that strife on excitement and could even do with it alone, there are also those that have no admiration for it whatsover so don't sacrifice depth and consistency to it, or you'lll kill the tables suspense of disbelief.
If you learn to use these five techniques in balance, you will be able to create an amazing gaming story that leaves your players on the edge of their seats and calling you a great DM even from the most clichee base situation.
There are some recources to improve your use of these techniques. The DMG2 has great tips on involvement.
The d20 CoC game has great tips on excitement and pacing.
The RBDM board and the storyhours of some of the greatest Ratbastards around provide great examples for consistency and some of the other techniques (Piratecat for example is the grandmaster of excitement).
There the already mentioned dungeoncraft (Monte's new ones should be good as well) and the normal DMG.
Lastly there cinema films for excitement and tv-series for twists (it's amazing how a character can be there for three seasons before his twist is revealed-the great thing about twists is that they're secret and can always be added later on).
I hope that helps
