Historical Romance (To be considered a historical, the novel must take place before WWII.)
Romance novels are about a romantic relationship, the historical setting is nothing more than a prop. Meaning the book should be able to stand alone if you remove the historical content or set the characters in another setting. Of course, there can be many subplots in a historical romance novel that don’t have anything to do with the romantic relationship that’s developing. Nevertheless, the conflict and climax in a romance focuses on the core theme, which is the romantic relationship. Romance novels also tend to reward characters for good behavior and punish those who are wicked. History can be woven into the story, to give the novel a sense of realism. Historical romance novels have a happy ending and are to be emotionally satisfying to the reader.
Historical fiction tells a story that is set in the past. That setting is usually real and drawn from history. Historical fiction is all about research. Unlike historical romance, historical fiction does not need to have a happy ending. Often times real-life personages are the center of the story, and the historical fiction writer modifies the events and motives for the characters actions. The emphasis is on the history, not the romance, although there can be a romantic involvement in the story; the characters are often apart for many chapters.
The most successful historicals focus on fictionalizing the lives of actual historic personages. Think of how popular the fictional stories of Anne Boleyn or Helen of Troy are in the marketplace.
A few famous historical fiction works are:
Leo Tolstoy’s, War and Peace
Ken Follett, The Pillars of the Earth
Mark Twain, American South