An allegory is a narrative in which the whole story consistently stands for something else, often at length. A parable is short and told to make a moral or spiritual point. Every parable works allegorically; not every allegory is a parable, because many are political or philosophical rather than moral.
The core difference
Overlapping forms distinguished by length and purpose.
- allegory — sustained, systematic second meaning: Animal Farm, The Pilgrim's Progress.
- parable — brief, with a moral or spiritual lesson: the Good Samaritan.
The difference in aim
An allegory can be satire, political argument or philosophy — it need not teach. A parable exists to teach; the lesson is the point, and the story is the vehicle. That is why parables are typically short: any more narrative would distract from the message.
Related form
A fable is also short and moral, but conventionally features animals or objects speaking, and generally ends with the moral stated outright — Aesop being the model.