When we tell someone what another person said, we have two options: repeat their exact words, or report the general meaning in our own words.
Direct speech repeats the exact words spoken, inside quotation marks.
She said, "I am tired."
Reported (indirect) speech conveys the same information without quoting directly — and without quotation marks.
She said (that) she was tired.
Reporting speech involves a change of perspective: the reporter is speaking at a different time, in a different place, possibly to different people, and under different circumstances than the original speaker. Because of this shift, several elements of the original sentence often need to change to still make sense.