This paper proposes a story generation mechanism based on Propp’s narratology. Although there are some Propp-based story generation systems, the novel characteristics of our system are combining with a comparatively large scale conceptual dictionary, intending a comprehensive implementation of Propp’s theory, and forming a part of our narrative generation system. The central part of the proposed system is a story grammar mechanism that we defined by organizing formally the description of “function”, which means an action seen from the result, and “sub-function”, which is our original name and the concrete action of each function. As other modules, the story grammar has a flexible structure which can be replaced by other story patterns and generated stories can be mutually combined. In this paper, we introduce the current version and enumerate future issues.