Direct Quote:
Direct quotes state exactly, word for word, what someone said (or wrote). The quoted statements always begin and end with quotation marks. A phrase identifying the source goes in front of or follows the quote.
"Without a doubt, we've got the biggest, fastest, best darn team in the league this year," observed Bears quarterback Bruce Easley.
Use direct quotes when a source's exact wording is presented in a concise, coherent way.
Paraphrase:
When you summarize a source without using the exact words or adding quotation marks, it's called an indirect quote or paraphrase. It's a common way to use your own words to clarify or condense someone else's statements:
Bears quarterback Bruce Easley claims that this year's squad will be superior to all other football teams.
Source: Harrower, Tim. Inside Reporting: A Practical Guide to the Craft of Journalism. 3rd ed., McGraw Hill, 2013.