"a short novel or long short-story," 1901, from Italian; see novel (n.).
It is not quite so clear as to when and where a piece of fiction ceases to be a novella and becomes a novel. The frontiers are so vague that one is obliged to recognize a middle species, or rather a middle magnitude, which paradoxically, but necessarily enough, we call the novelette. [W.D. Howells, "Some Anomalies of the Short Story," The North American Review, vol. CLXXIII, August, 1901]
"fictitious prose narrative," 1560s, from Italian novella "short story," originally "new story, news," from Latin novella "new things" (source of French novelle, French nouvelle), neuter plural or fem. of novellus "new, young, recent," diminutive of novus "new" (see new). Originally "one of the tales or short stories in a collection" (especially Boccaccio's), later (1630s) "long prose fiction narrative or tale," a type of work which had before that been called a romance.
A novel is like a violin bow; the box which gives off the sounds is the soul of the reader. [Stendhal, "Life of Henri Brulard"]
The word was used earlier in English in the now-obsolete senses "a novelty, something new," and, in plural, "news, tidings" (mid-15c.), both from Old French novelle.