The biggest problem i'm having is getting the balance between dialogue and description, i'm guessing its at the writers discretion but I could use a guideline.
One thing that helped me with dialog was to look at the writing of two or three of my favorite authors (high caliber pro authors, the kind whose books are sold in Borders or Barnes&Noble) and see how they did things. My own dialog is still a bit stiff, but not as much as it was.
Let me take apart the opening of one of my early stories, "Late Penalty":
"Your pass tokens expired yesterday."
[Speaker implied here. We're left to figure out who it is in the next paragraph]
Zorian the merchant sighed in resignation. "I was hoping you'd overlook that." He had to look up at the border guard. Timon, the guard, was slightly taller than average for a centaur. Zorian, on the other hand, was a human - a "flatfooter" - and of only average human height.
[Introduce Zorian the merchant with a bit of "stage business" - description as part of a dialog tag. Then more description, introducing Timon, the border guard and the speaker in the previous paragraph. Also more description of Zorian.]
"You're a good man, Zorian, and if it were something with the export tallies I would overlook it. But not this. Not something touching on the Prophesy."
[More implied dialog. Here we should be able to tell that it's Timon speaking]
"Truth be told, I wouldn't either if I were in...if I were in your position." Zorian grinned wryly. "Forget I asked. When the gods send a prophesy..." He made a sign to ward off ill fortune, and Timon followed suit. "Can I first pay off my porters?"
[Dialog by Zorian with more "stage business" - 'grinned wryly.' More description of an action by both Zorian and Timon.]
"Aye, you can do that."
[Once again, implied dialog by Timon]
I should note, my "natural" style is to include a lot of speech tags: Joe said, Sally said, the mechanical horror said... I was trying to get away from overusing tags, not by replacing 'said' with other words (muttered, cried, shouted, whispered, etc.)[1] but by using more implied speaker dialog without tags. I may have overdone it.
[1] "Said bookism" - using other words to avoid using "said" - is suppose to be a common writing error. My problem is a different one; I'll use grumbled, shouted, or whatever only when it's at least moderately important to note that the speaker is doing so. I'm not afraid of using "said" a lot. Instead my preference/problem is to heavily tag/over-tag who is speaking in a bit of dialog so that the reader won't lose track.
