Note: Both "lie" and "lay" have several, very different definitions - we're only dealing here with the one definition of reclining or placing something.
When should you use "lie" in a sentence, and when is "lay" appropriate? Is there really a big difference between these two little words? Why should it matter??
Last things first. It matters because using correct English shows respect for your reader. Correct usage also provides consistency, and that makes readers comfortable. And, those readers who do know the difference between "lie" and "lay" will appreciate your attention to detail.
The difference lies (pun intended) in the person or thing that's being affected by this little verb. If you're speaking of the main subject of your sentence assuming a horizontal position, that's "lie." ("I have to lie down," "Does he lie awake often?")
But if the act of being set down or made horizontal is happening TO something or someone, use "lay." ("Just lay the cards on the table," "You can lay those boxes in the bedroom.") In grammar, this is called a transitive verb. I think of it as transferring the action to another entity. "Lie" is intransitive because it doesn't happen to anything else.
Simple, right? So why does it seem so confusing?
The big hairy snarl happens because the past tense of "lie" just happens to be "lay!" So I may
have to lie down today, but I lay down yesterday. That's absolutely the correct usage.
It's super common to hear "lay" used incorrectly in the present tense (as in "I have to lay down") just because that particular word naturally comes into use more frequently, so it's easy to just assume you can use it all the time. But the reverse doesn't happen often. You wouldn't casually say, "You can lie those boxes in the bedroom." That's the clue that "lie" and "lay" are not interchangeable.
So if "lay" is the past tense of "lie," then what's the past tense of "lay"? It's "laid." She laid her cards on the table.
If you're ever stuck for which verb to use, this might help you remember:
"Lie" has an i like intransitive and me-myself-and-I.
"Lay" has an a like transitive and transfer.
So, stop telling your dog to "go lay down." Train it to respond to good grammar.