Some people claim that on the fly DM'ing is a natural skill, improving things left and right to entertain their players. While other DMs will prep every little detail, making sure there is no unanswered questions that come up for the most common things, there is no lull, there is no lack of consistency at all in his games.
I mostly fall under the DM'ing on the fly, and will jot down only key points that happen when I am "making things up".
Most people enjoy either style, while most people dislike on the fly DM'ing, because things are not constant and things happen to change too much for their taste.
I did an entire Actual Play podcast, called the Book of Sorrows, where all I did for prep was jot things down on a yellow sticky note at work before the game. Could the players tell? Yes. Did they have a great time, Yes.
What style do you enjoy or use?