Showing through dialogue

While responding to a question from East for Green Eyes on my last post about showing and telling, it occurred to me that dialogue is one of the most effective forms of showing there is. It may seem, at first glance, that dialogue is telling.

For example:

1. "We've lost the battle! Run for your lives!" screamed Ronaldo.
2. "The truth is, the woman you always called Mom is your grandmother, and I am your real mother," Laura said.

In these cases, the reader may be learning about the outcome of the...