My own feeling is that The Outer Limits is sci-fi, and The Twilight Zone is fantasy.
But is this correct?
Sort of, but not quite. OL was science fiction all the way, always dealing with aliens and superscience and the like rather than anything supernatural (as far as I can recall). TZ was more eclectic with regard to genre; it was generally fantasy and supernatural horror but had plenty of science fiction as well, and sometimes blurred the lines between fantasy and SF (e.g. "Death Ship"). It even had a couple of episodes that were straight suspense with no fantasy/SF elements at all. Serling's goal was to use speculative fiction as a vehicle for social commentary or challenging drama that would have too much trouble getting past censors if it weren't encoded in "unreal" scenarios. He didn't care whether the "unreality" came from magic or from aliens and spaceflight.
I have watched many more Twilight Zone episodes than Outer Limits episodes over the years, but it seems that whenever I have seen Outer Limits, the story has dealt with a monster (the monster may be a misunderstood being, but it is still a monster in that it is a freaky looking creature effect or man in a costume), whereas I feel that monsters are rare on Twilight Zone.
That's right. The network insisted on a "monster of the week," over the objections of the creators, who wanted something more subtle and intellectual. So they did their best to tell intelligent, thought-provoking science-fiction stories that happened to have monsters in them. TZ was more about suspense, mystery, psychological horror, O. Henry-style twists and shock endings, that sort of thing (although it occasionally and often disastrously dabbled in comedy).
There's also the distinction that OL was an hourlong show while most of TZ was in a half-hour format. TZ's fourth season (of five) was hourlong, but the stories were often overly padded and not as effective. Its focus on suspense and shock twists and such was better suited to a "short story" pacing as opposed to the "novelette" pacing of OL.
Indeed, quite a few TZ episodes were adapted from published short stories, making it one of the most "literary" SF anthologies ever made. Rod Serling was an accomplished television playwright, but TZ's other regular writers, Charles Beaumont and Richard Matheson (and occasionally George Clayton Johnson), were well-known prose authors with numerous published works under their belts, many of which they adapted for the show. In other cases, Serling bought other authors' stories (such as Jerome Bixby's "It's a
Good Life") and he or one of the other regulars adapted them for the screen. I think a few OL episodes were based on pre-existing stories, but not many. (That was a more common practice on the Showtime anthology series of the same name, though I've never really considered that show a legitimate continuation of OL since it's very different in style and sensibilities.)