There are four ways that an author can employ indirect characterization. (As examples, let us refer to O.Henry's "The Gift of the Magi")
- through a physical description of the character (e.g. Della is slender with brilliantly shining eyes. Her pride, however, is in her beautiful hair that falls, "rippling and shining like a cascade of brown water. It reached below her knee and made itself almost a garment for her.")
- through the character's actions (Della is "flopped on the shabby couch... howling....She finished her cry and attended to her cheeks with the powder rag.")
- through the character's thoughts, feelings, and speeches (e.g. "Will you buy my hair?....Give it to me quick [the $20.00 for her hair]" Della says. "She found it at last....As soon as she saw it she knew it must be for Jim." When she returns home, she looks in the mirror: 'If Jim doesn't kill me,' she said to herself,'before he takes a second look at me, he'll say I look like a Coney Island chorus girl. But what could I do...'")
- through the comments and reactions of other characters. (e.g. 'You've cut off your hair?' asked Jim laboriously, as if he had not arrived at that patent fact yet....'Don't make any mistake, Dell,...about me. I don't think there's anything in the way of a haircut or a shave or a shampoo that could make me like my girl any less.'"
You may wish to also see the site below which gives suggestions on how to analyse a character.
I think one excellent example of indirect characterization is in the Jay McInerney novel 'Bright Lights, Big City." It's written in the second person, not a very commonly used point of view. The main character rarely discusses his own feelings or thoughts; he describes what he does and what happens in a given day and the reader is invited to draw their own conclusions. It helps that the character becomes increasingly unable to sustain his unhealthy lifestyle of casual sex, illegal drug use and debauched party going. In one memorable scene the protagonist mentions being at a nightclub and locking himself in the men's room where he cries for a few minutes; but at no point does he describe his thoughts or emotions, only his actions.