The mood of a story is the atmosphere that the writer creates in order to arouse a specific emotional response in the reader.
In order to achieve the desired atmosphere, authors resort to various combinations of elements such as setting -the description of the place and time in which the story takes place, for example- and tone -the author's attitude to his subject matter and characters.
Besides descriptive adjectives and suitable verbs, figures of speech play a most important part in conveying mood. You will find that the most effective are similes and metaphors.
Let us have an example. In The Schopenhauer Cure, a novel about a psychiatrist that must cope with a terminal disease, Irvin Yalom writes, "Why rush to the exit door before closing time?" We know from previous paragraphs that Yalom is talking about death. Would the effect be the same on the reader if he had...
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put it as "Why give up the joys of living before death reaches us?" Certainly not. Hismetaphor softens the anxiety of death and shows us that the character feels moderately optimistic at this stage of his disease. As the story develops, the character's discourse will take on darker hues, and the mood will consequently change.
One of the first authors to recognize the importance of mood in a short story was Poe. He thought it was so important that he theorized that a short story should create one over-reaching mood. Read "The Black Cat" or "The Tell-Tale Heart" and notice how Poe uses language to create a mood of horror, terror, and irrationality.
If the question is regarding how to find or discover the mood in the story, there are some steps that can be taken to effectively determine this. One way to "read" this is to examine the level of narration and how the story unfolds. Oftentimes, the author will be deliberate in attempting to convey a mood to the reader through word choice, descriptive language, and also the manner in which the story is explained. For example, the narration schematic of Holden Caulfield, in Catcher in the Rye helps to illuminate how he sees the world and the mood of his narration. At the same time, the mood of a story can be conveyed through setting elements. For example, Shakespeare's MacBeth uses a great deal of the theory of correspondence, where natural weather conditions helps to bring a great deal of light on the thematic elements of the story. Sometimes, the mood can be expressed through characters themselves, especially in their physical description. In Rushdie's Midnight's Children, Saleem Sinai is described in extreme detail, especially his nose and the powers of smell (and nasal drainage) he possesses. This helps to illuminate the idea of Saleem's magical powers as a child of midnight and also helps to bring out the mood of the pain in Partition, where the Indian subcontinent was divided as eyes (Bangladesh and Pakistan), nose (India), and nasal release (Sri Lanka). Sometimes, authors will convey the mood of the story in these types of manners. If trying to determine the mood, pay special attention to the "hints" the author gives.