The story The Lily and the Thorn published in December 1877 represents to some degree the backstory to the novel Young Musgrave - which was serialised throughout 1877 and published in book form at the end of 1877. The Lily and the Thorn is mostly about what happens leading up to a murder; and Young Musgrave is mostly about what happens after the murder. However Young Musgrave is not truly a sequel, but more a reworking of the same material: Mrs Oliphant uses different names and locations, and modifies the story line in certain important ways.
Surprisingly, Margaret Oliphant had already explored this story line once before in her early novel Merkland (1850). Even the name of the fugitive's daughter in Merkland is the same as in Young Musgrave - Lilias. Perhaps the original germ for these three works came from Margaret Oliphant's mother: as a child, Margaret had loved the many Scottish stories and legends told to her by her mother, and she appears to have used several of these stories in her fiction.