Dialogue is a conversation between two or more characters. It must serve a purpose in your story. Either as a tool to forward the plot, give life to the people, and add details to the world. Like all writing, it has rules and nuances. Here are a few of them.
Dialogue is formatted strictly. Each speaker gets their own paragraph. The spoken words are surrounded by double quotation marks. Here's a basic idea of what it should be:
"These are the words your character says."
That was a sentence alone. It's the most basic way to write conversations, but it won't get you very far. Try adding dialogue tags or actions. They are formatted in different ways and operate under different rules.
"Dialogue tags are phrases between, before, or after what your character says," she explained.
The sentence ends with a comma instead of a full stop before moving on to the dialogue tag. Notice that the double quotations fall outside of the punctuation. This applies to all formatting that involves quotation marks.
Don't be afraid to be creative with your dialogue tags, avoid overusing simple verbs like said, or asked. Also, add adverbs to accent dialogue. They help with showing the tone with your character speaks. It's better to say a character screamed angrily than to tell your audience he was angry outright.
Another way to show tone is through action. It looks something like this:
He grinned. "You want to learn about writing?"
The action is the character grinning before speaking. If 'he grinned' was the dialogue tag, it would end with a comma. You can tell this is an action because of the full stops. Like dialogue tags, actions can be used anywhere in dialogue. Some writers are hesitant to put them before or between, but there's no rule against it.
Formatting is important, but there are other technical rules for dialogue. For example, good dialogue is a reflection of real-life discussion, without the extra fluff. You won't find 'ums' or 'ohs' or 'ahs' in fiction. These are called crutch words, and everyone uses them to some degree, but they don't benefit your writing. They only add bulk to what a character has to say, so keep them out of your work.
Crutch words aren't the only things a writer should cut. Some conversations you or I would have in real life can be erased entirely. Simple hellos and small talk should be left out of your writing if it doesn't serve the story. Pointless small talk is common in real life but useless in fiction. Although you should keep your dialogue realistic as you can, don't bore your readers.
Keep these guidelines in mind when you write. Remember that dialogue expands your characters, your world, and your plot. It's a study of real life, but streamlined and with intention. No story is complete without dialogue, so enjoy writing yours.