Actually, it's not cut and dried.
I'm a librarian, and a growing number of us have a totally different definition of fiction.
Fiction basically tells a story, and can have elements of both truth and "made up" elements. Historical and realistic fiction often blend real-life people, places, and events with characters and/or events created by an author. A great example of this is "Fever 1793' by Laurie Halse Anderson, which uses a real-life yellow fever epidemic and a number of actual people from the period to tell the story of a young girl and her family -- all figments of Anderson's imagination -- and how they "survived" the epidemic.
Non-fiction, on the other hand, simply presents facts. Look at the shelves of any library, and you'll see that all the books in the non-fiction sections are informational in nature. In most libraries, the Bible would be in the non-fiction section (200's in the Dewey system), simply because that is the general category listing for all religion books.
Taking all of this into account, it's clear that the Bible is a collection of thousands of stories. Some of these stories can be proved true, while others cannot. Interestingly enough, most libraries also consider myths, fables, folktales, and legends to be non-fiction works (398 in the Dewey system).
While all of this seems pointless, it really isn't. The Bible provides a narrative of a time and place that few people truly understand, as well as spiritual guidance for those who seek it.