Dialogue in fiction is a verbal exchange between two or more characters. If there is only one character, who is talking to himself in his mind, it is known as interior monologue.
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Identifiers, also known as tag lines, dialogue tags or attributions, let the reader know which character is speaking. An example would be:
"This breakfast is making me sick," George said.
The George said is the identifier. Said is the verb most writers use because reader familiarity with said prevents it from drawing attention to itself. Although other verbs such as ask, shout, or reply are acceptable, some identifiers get in the reader's way. For example:
"Hello," he croaked nervously, "my name's Horace. What's yours?" he asked with as much aplomb as he could muster.[1]
Stephen King, in his book On Writing, believes said is the best identifier to use. King recommends reading a novel by Larry McMurtry, who he claims has mastered the art of well-written dialogue.[2]
Substitutes are known as said-bookisms. For example, in the sentence "What do you mean?" he smiled., the word smiled is a said-bookism.