In 2004, just as Kelly Link was finishing up Magic for Beginners, her second collection of short fiction, three New York publishing houses lobbied hard for the book. But Link turned them all down. "As much as I liked the editors who offered, I enjoyed the process of publishing my first book so much that I didn't think I should take them," says Link, 35. "Plus, we had a pretty good idea how well we were going to do with the new book—just based on the sales of the last one."

The "last one" was Stranger Things Happen, Link's acclaimed first collection, which was self-published in 2001 by Link and her husband, Gavin Grant. The seeds of their house, Small Beer Press, were planted in 1995, when the two aspiring writers me while working at Boston's Avenue Victor Hugo Bookshop. "We worked there on and off, leaving sometimes to temp," Link says. "At one point, Gavin was working in an office and had access to copiers and wanted to put out a zine for fun. He said he figured he could either go on a vacation to Florida or spend the same amount of money putting out a zine twice a year and possibly even get money back." The result was the first issue of Lady Churchill's Rosebud Wristlet, of which they printed 26 copies—and made their money back. Soon, they were putting out an issue every six months.

In 1996, after the couple had published two chapbooks (in addition to the zine), a handful of New York editors asked to see Link's collection. "They would read it and say, 'We really loved this—but we just don't do well by short story collections.' "

So the couple, who married in 2001, decided to publish her collection on their own. "Gavin and I were the only people who were doing this as a full-time job, so our margin was low—we didn't have to make a lot of money," Link says. "We had two goals. One was to break even; the other was to make artifacts that looked as much as possible like real books. Which, when we started, seemed hugely daunting. The design and making of the books were the most work and, in a way, the most fun... putting covers together, choosing a font. We've published all our books on recycled paper, which is much more expensive, but because they're our books, we get to do whatever we want."

Still, the couple had reservations. "Gavin was working at ABA's BookSense in Tarrytown, N.Y.], and it would come up that he put out a zine and books, and people would ask what he was doing, and he would say, 'I'm publishing my wife.' " Link laughs. "It just sounded terrible." Even after the book began garnering attention, there was skepticism. One night, Link returned from running errands to their Brooklyn apartment and found an answering-machine message from someone at the New York Times. "He said, 'We're going to review the book and I'm calling the publisher, but I think this is also the author'—and he just burst out laughing, like it was the funniest thing he'd ever heard," Link says. "But they needed copies, so I put the books in an envelope and took them into the city and dropped them off. I got to be my own courier."

Stranger Things Happened did far better than the couple could have imagined. "We initially printed 2,000 copies, because we wanted it to be taken seriously—but when it sold out very quickly, we realized that it wasn't just our friends buying it," says Grant. "You could say you know 500 people, but you know for sure you don't know 1,500." The book, now nearing its fifth printing, received raves. Laura Miller at Salon.com: "prose so flawless you almost forget how much elemental human chaos they contain." PW declared Link a "rising star."

Link earned entry into a select group of writers (think Jonathan Lethem, Elizabeth Hand, John Crowley and Peter Straub ) whose work, though genre-based, is undeniably literary. "Kelly comes from genre," says Scifi.com fiction editor Ellen Datlow, who bought many of Link's early stories. "But because she writes so well and has been so smart in terms of how she's managed to place herself, it doesn't really matter whether her work is genre or not genre. (Link's category-defying writing is reflected in her eclectic, sometimes obscure reading; see sidebar.) "A lot of her work is coded in this post-postmodern way, giving a kind of attitude that almost conceals the pain," says writer PeterStraub. "And she's funny."

Now that Magic for Beginners is receiving accolades ("The purest most distinctive surrealist in America"—Booklist; a PW star), Link and Grant have made the text of Stranger Things Happen available free online at Creativecommons.org. (There were nearly 13,000 downloads in just the first few days.) "I don't see any downside to it," says Grant. "To build readership you have to make books available easily, widely and cheaply. And the books themselves are beautiful things, so if you want to own them, we have them."

Link is often asked when she's going to write a novel—an idea she finds "frightening." Why? "I don't know if I know how to do it," she says. Part of Link's fear may stem from the fact that she sometimes finds it difficult to make her characters want things—want being the engine that drives most, if not all, novels. "I find characters who are passive to a certain extent appealing and sort of realistic," Link says. "It's terribly unrealistic to want things too badly. Still, wanting something not to happen is sort of a desire. And even if you're writing from the point of view of people who are just trying to get by, they still have lives and jobs—you can't avoid everything. My work is probably in The Cat in the Hat model of writing, where somebody comes into a story or a life and just really fucks stuff up."

Baker is deputy editor atReal Simple magazine.