One thing that happened to American literature during the modernism period was an increased interest in the subjectivity of reality, as seen in The Sound and the Fury and Ulysses.
We also see a theme of personal relationship with history and an exploration of the idea of personal identification of self with cultural models.
Along with the disillusionment of the Modernists, there came a certain cynicism that resulted from the futility of the quest to find order and structure. Certainly, some of Ernest Hemingway's works reflect this disappointment in any idealistic state.
Modernism of course is a movement that didn't just start following the first World War, but started before and carried on after it. In many ways Modernism was influenced greatly by the actual experience of the war and the massive loss of life that resulted from it. American Modernism therefore is reflected by a disenchantment of some traditional ideas and notions of aspects such as "war" and "nationalism" and sought to focus on the experience of America and how it affected a wide number of different groups and classes. Thus, as #2 points out, Steinbeck focused on the poverty during times such as the Great Depression, and Fitzgerald focuses on the "Jazz Age" and the disillusionment with it.
American modernism covers pre and post WWI America. As with any other period in which world powers come together for a specific reason, the War affected the country in a myriad of ways ranging from the economy, to race relations, the role of women, and the overall psyche which manifested directly onto literature.
Greats such as Hemingway told the experiences and stories of War, John Steinbeck's Grapes of Wrath condemned the effects of the economy, black writers began to be read and started their own guild of authorship and black and white writers seemed to unite in Art. The 1920's brought F Scott Fitzgerald's classic The Great Gatsby, showing the signs of changing times, expectations, and wishes of individuals during the times of prohibition and the slow decline of the US financial world.
Concisely, literature became a stamp of the pre and post WWI era, and was the first look into what a post war society looks like, giving us a foreshadowing for the future that was to come.