It is usually done with narration, sometimes straight from scripture, or sometimes with an embellished drama script found here at rotation.org or elsewhere online. You can also create your own by looking up the story in THE VOICE version of scripture which breaks down stories like a script. You can see a good example of The Voice's translation/format for Lazarus' story here.

• Children's bible story books are often a good place to start too. Read the story, then they re-inact it. 
• First read them the story, discuss.  Then re-read the story and have the children take turns (may do it in groups if you have a large group) they act it out as you read.  You can add to the story drama by adding exaggerated movements to your dialog example:  The Good Samartian - The priest RAISED HIS ARMS in surprise.  Then he LOOKED SLOWLY TO THE RIGHT AND SLOWLY TO THE LEFT to make sure no one was watching.

OPTIONS:

• Freeze Scenes
  It may also be done with "stills." In other words, the children get in position and hold that position while the narration occurs, like a photograph. Then for the next scene, they get into a new position and hold that position.
• Puppets
  Shadow plays may also be done with puppets. For puppets the white sheet is just large enough to cover the front on the puppet area and once again is taut and secure and the light definitely shines from the back. Keep in mind when you are using puppets for the shadows, you may want to use a puppet that gives definition to the shadow.