Most critics agree that “A Municipal Report”—set in Nashville, Tennessee, as a challenge to Frank Norris’s assertion that the only “story cities” in the United States are New York, San Francisco, and New Orleans—is O. Henry’s best. It is often singled out to suggest that O. Henry could have written better stories if he had tried harder, took himself and his writing more seriously, and had more discipline. The story is more sophisticated than other O. Henry stories because of its complex narrative structure and its creation of two compelling characters—the southern lady writer abused by her husband and the African American carriage driver who rescues her. As a result, the story is more ambitious than merely an illustration that an exciting story can be based in such an ordinary place like Nashville.

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Alternating quotations from encyclopedias and atlases about the geography and history of Nashville with the first-person narrative of one man’s discovery of a little personal drama of cruelty, avarice, endurance, and loyalty, O. Henry creates what some have called his masterpiece. Although it makes use of the conventions of melodrama, it exceeds those conventions. The villain of the piece is Major Caswell, the worst kind of cardboard southerner who bangs his fist on the bar and replays the Civil War from Fort Sumter to Appomattox. The hero is Uncle Caesar, a noble African American man with a regal bearing who tries to protect a southern lady. The heroine is Azalea Adair, a genteel, educated, and gentle lady of the old South. What Alfred Hitchcock once called the maguffin, a key device that eventually reveals the secret that propels the plot, is a torn dollar bill held together with blue tissue paper and a button from the carriage driver’s coat. The story ends with the narrator’s complicity in the death of Caswell by picking the button up at the crime scene and tossing it out the window into the Cumberland River as he leaves town.

“A Municipal Report” is introduced by two meaningful epigraphs: A verse from Rudyard Kipling sings the pride of mighty cities, while a paragraph from Frank Norris asserts that only three cities hold value for a writer—New York, New Orleans, and San Francisco—and easily dismisses the possibility of anything interesting ever happening in Chicago, Buffalo, or (most absurd) Nashville. This story, ironically, is set in unlikely Nashville. It fuses a sense of history, romance, and Rand McNally, and reveals a narrative of universal human interest irrelevant to geography.

The narrator, a literary agent who is visiting Nashville, arrives in this Tennessee city and, after being transported to his hotel, begins to inspect his surroundings. After strolling about the nearby streets and seeing that everything closes at sundown, he becomes bored with watching streetcars and listening to occasional laughter emanating from innocuous ice-cream parlors, so he returns to the lobby. Nothing of consequence, apparently, is going on in Nashville.

In the lobby, the visitor meets “Major” Wentworth Caswell, a red, pulpy-faced, sordid-looking man with a talent for ringing the brass cuspidor with tobacco chaw. A professional Confederate southerner, Caswell drags the visitor into the bar, authoritatively pounds the table for service, and launches into a rambling disquisition on genealogy, stressing in particular his own patrician background. The narrator, himself a southerner, brands Caswell a rat extremely offensive to him. The bogus major may have the standard accoutrements of southern aristocracy—string tie, slouch hat, Prince Albert coat—but he is crude and profane. The visitor’s impression of the hard-drinking, annoying major is corroborated by the desk clerk, who identifies Caswell as a local nuisance and loafer with no known means of support, his...