Is the entry to the left of the fireplace? How many do you need to sit? Will there be a TV?

A big area rug and drapes are cozy and reduce sound. They say start with a rug or artwork you love as inpiration.

This arrangement could be scaled to your room:

Your space is lovely, but I understand why you need help -- why are living rooms so hard? My thoughts:

- This isn't a particularly large space, so take care to purchase smaller-scale furniture.

- Do you plan a TV in this space? If so, I'd consider that first. I don't care for TVs over fireplaces, so I think I'd place it on that back solid wall.

- Then I'd do a sofa against the staircase wall + two chairs and an accent table under the window. End tables for the sofa + a smallish coffee table. Pull them out a bit from the wall. I'd do it that way because the chairs would block less light /allow more view of the window than would the sofa.

- A lamp at each end of the sofa + one between the two chairs. If you don't have space for an end table at each end of the sofa, go with a floor lamp on the far end of the sofa.

- With the furniture in place, yes, definitely a rug.

- I'd do these things, then live with it a bit before adding accents ... plants, artwork, etc.

Actually, in my opinion, it's a large space for a living room, especially since there is an additional family room. If it were a bit smaller, I was planning to furnish it with just a sofa and two chairs. However, since it's big, that might feel too sparse. Right now, I'm planning to use two sofas and two chairs, which is more than I need. I'm not going to put a TV in this room. I was also thinking of placing a chair by the window, but I'm undecided about whether to put a sofa against the main wall (window side) and a chairs by the stairs.

@Eml Gns don't put in more seating than you need just to fill space. I think you will find this space can serve more purposes over time than just a conversation area when you have dinner guests: afternoon nap, board game or puzzle, Christmas tree, reading room, morning floor exercises...

Start with a sofa and two chairs. Instead of lining them up against the walls as if they are all afraid of something unpleasant happening, float them in front of the fireplace to better allow for conversation and parallel with the window wall and stairway wall. I agree with @Mrs. Pete placing the sofa parallel with the stairway wall and the two chairs lined up parallel with the window wall to let more light in the room. You may have a different idea because of some use you haven't yet shared.

Then think of what kind of tables you want for those seated. Coffee table, Ottoman with tray, or not? Console table behind the sofa (with storage or a pair of stools)? Side table between the chairs? Nesting tables you can move as needed?

I think you will find you will want something centered on the wall opposite the fireplace, something proportional to the fireplace to balance the room. Someone else would put a TV there, but you don't want that (yay!). What you put there depend on your life stage or situation. Bookshelves for books and other "stuff" existing or as it accumulates? Pair of dressers flanking center with something between? Large meaningfully tapestry or art? Small dry bar? Big mirror to reflect all that light? House plants in summer and Christmas tree in winter?

You can further emphasize the center of the room as it's main function, a conversation area, with eye-catching ceiling and floor treatments: area rug, ceiling light fixture, coffee table/ottoman.

For more help, provide feedback and consider providing room dimensions in inches. Maybe a pro will jump in and take over.

I should add that the time of day you use this to entertain will better determine your light and color management. You have all that wonderful light for daytime use, but if you use it mostly at night, you'll want to think of blocking outsiders from viewing you, and you'll want mood lighting. Night use could influence your color scheme towards dark jewel tones on the walls with light-colored furniture to further emphasize the conversation area. Just mull it over.

Post a floor plan with the dimensions of the room. Usually it is the family room that is next to the kitchen. The FP place certainly seems awkward, what is on the other side of it?