When a person or work is quoted directly and word for word, the quotation is placed in quotation marks.
An indirect quotation in which the substance but not exact wording is used does not take quotations marks.
Correct: Macbeth said, "All our yesterdays have lighted fools the way to dusty death."
(A direct quotation)
Incorrect: Macbeth said that, "Their past actions lead fools to death."
(Contains the substance, but not exact words. Quotation marks are not used.)
Correct: Macbeth said that their past actions lead fools to death.
See Quotation Marks Index for more on quotation marks.