Direct characterization is what is explicitly told to us by the author about a character. However, in The Great Gatsby, the story is told through a first person observer viewpoint. In other words, Gatsby is characterized directly by Nick, not the author. The opening pages of the novel provide examples of Nick's direct characterization of Gatsby in which Nick declares that Gatsby had
an extraordinary gift for hope, a romantic readiness such as I have never found in any other person and which it is not likely I shall ever find again.
Indirect characterization is achieved by inference. From the descriptions of the character's actions, speech, appearance, home, we can determine much about a character's personality that usually results in our judgment of that particular personality. Throughout The Great Gatsby, the readers must determine whether or not Nick's comments about Gatsby are true or if we have a different impression of the man that Nick is both impressed with and somewhat contemptuous of.
For instance, Gatsby's constant use of "old sport," seems to imply a somewhat pretentious speech. His car is described as
rich cream color, bright with nickel, swollen here and there in its monstrous length with triumphant hatboxes and supper-boxes and tool-boxes
giving the impression of ostentatiousness. Gatsby's association with a man like Mr. Wolfshiem suggests Gatsby's corruption. Even when Nick withholds his judgment, which he often does until the end of the novel, we are given key details that allow us to develop our own opinion of this character.