GonWaki, does your question imply that narration and character development are separate entities that do not mix, like oil and water? About four years ago I started writing a screenplay. Its gathering dust on my shelf for a year now and has gained me neither fortune nor fame. But it was fun to do and I learnt a lot in the process. When writing a screenplay, you are restricted by what can be visualized on a screen and made audible through a speaker. There is description of scenery, props and outward appearance; there is action and dialog. Unless you use an off-screen narrator, which is hard to pull off in a visual medium like film, there is no narration. Its pointless to write in a screenplay, "Mr. Kowalsky is a grumpy man". How could a cinematographer shoot that? You have to write dialog and action that show his grumpiness. A screenplay of 120 pages is full of character development, though we never actually look inside the heads of the protagonists. Their nature is revealed by what they say and what they do. My point is, advancement of the story and character development are one and the same. In a novel or a short story you have the additional possibility to let the reader participate in the characters thought processes. However, it is, in my opinion, not advisable to interrupt the story and give the reader a list of character attributes or a lesson in psychology. Instead of writing something like "Jim was a shy guy ...", and thus slowing the pace of the story, it is better to create a scene in which Jim squirms and stammers and makes a fool of himself in a crowded room. When the author claims "Jim was a shy guy .", the reader is informed but not involved. The dramatic scene showing the poor guy ridiculed, on the other hand, makes us feel with the fictional character. Characters develop because the story advances, but much more important is: the story advances because the characters develop. Theres no need for any interruptions. Narration and character development dont interact like oil and water. They are like salt and water. I have a theory where the notion, that character development interrupts narration, originates from. It happens when you plot a story in advance and then squeeze some characters in. Such characters can be made of cardboard, without affecting the flow of the prefabricated plot. However, such a story is trite and pulpy. Ideally, believable and life-like characters come first. Their decisions, made in accordance with their skills and character traits, determine the flow of the story. No need to throw in paragraphs of psycho babble that stop the story dead. There are characters and there is a conflict. The conflict changes the characters so they are finally able to solve the conflict. When are we supposed to start developing our characters? For me there can only be on answer: at the very beginning and then keep at it till the end. The moment a character says or does something, the author is writing character. Once your hero has saved the world and kissed the princess you may stop, not a line earlier. Of course, some character traits and skills have to be introduced early on. Say, you have a hero with a unique talent. He can hold his breath for ten minutes or build a bomb from a pencil and a shoe-string. He uses this skill to save the world. If you havent introduced this odd ability before, the deus ex machina bursts out with a bang, ruining all credibility. The solution seems contrived. It is much better to show the heros skill very early in the story in a casual way. The reader forgets about it while the story progresses. Then comes the pay-off: "Wait a moment! That guy can build a bomb from a pencil and a shoe-string! The world is saved!" That has a strong impact on the reader (even makes him/her feel smart if he/she has been able to figure it out in advance) and upholds credibility. Hopefully, the reader admires the authors clever plotting. (By the way, this is one reason why rewriting is so important. Sometimes, you simply have to go back and add something at the beginning.) Of course, it may be necessary to fool the reader and disguise a persons real character until the surprise ending. Why not, as long as its believable and involving.