There are unique challenges to writing historical fiction. Here are two of the most important, in my opinion.

I love historical fiction but it’s a recent appreciation and it was born of a reading of Perfume: The Story of a Murderer by Patrick Suskind because it’s a historical setting but a modern novel form and it is incredibly artful; it is literature because the period of time involved is used as another device to examine a universal truth.  It’s not just a story of the building of a bridge or a queen, a beheading, a war.  It’s art.

I think it’s important to remember that fiction, regardless of genre, setting or format, is about illuminating the human condition; it’s not about “gosh, something interesting happened.”  That doesn’t work for modern stories either. It has to be “gosh, this interesting thing happened and look at the fascinating emotional transformations that happened as a result.”

But historical fiction faces at least two additional challenges, two requirements for historical fiction as art:
1.    The story has to be rooted in the time period.  I teach the writing of historical fiction (most recently at The Writing Salon in Berkeley and San Francisco) and I tell my students ‘you can’t just throw a tapestry over the flat screen TV and call it a historical.’   Rhona Martin, author of Writing Historical Fiction says, “There is really only one valid reason for setting a story outside the present day and this is that the situation springs from the period, and could not possibly have happened at any other time.”
2.    The story has to be attached to the current cultural matrix.  The historical situation has to reflect, illuminate, be tied to the current historical period.  E.L. Doctorow says “The cultural matrix in which the historian works will condition his thinking; he will speak for his time and place by the facts he brings to light and the facts he leaves in darknesss… Nietzche says “there are no facts in themselves.  For a fact to exist we must first introduce meaning.”…Recorded history undergoes a constant process of revision, and the process is not just a matter of discovering additional evidence to correct the record.  However remote in time events may seem to be, every historical judgment refers to present needs and situations…This is why history has to be written and rewritten from one generation to another.”  As non-fiction historical writing is shaped by current reality, so especially is historical fiction.  Especially fiction, since it deals with emotion; readers read to satisfy their needs, not idle curiosity.
Here’s a great example of a story that satisfies the two requirements:
This came from a student whose story is set in 1930s. Three main characters; young man is wild about the new inventions; believes they’re the salvation of the world; and despite being betrothed to a farm girl, falls in love with a woman  who is a singer.  The singer is weak and sickly but can project herself through the marvel of radio; the sickly singer falls ill while the man is away and he takes one of the first airplanes across country to her side but she dies before he can get there; he is disheartened/ it is revealed to him that technology is not the savior; she is not larger than life; and he goes home to the farm girl but when he tries to tell her of the incredible experience of riding in one of the first planes, she is dismissive and negative, illustrating the digital divide and the universal truth that shared beliefs and experiences are key to love.