The present paper develops the concept of discourse within Austin’s original speech act theory as laid out in Austin, J. L., 1975 How to do things with words. Oxford: Oxford University Press, and provides a model to explain illocutionary acts in discourse. In uttering something, a speaker performs an illocutionary act and imports its conventional effect into the discourse, in which the next speaker (the hearer in the preceding turn) performs an illocutionary act and brings about its effect, and the sequenced effects develop the discourse. Both the content of an utterance imported into the discourse as the illocutionary effect and the discursive sequence that the utterance creates are sensitive to the illocutionary-act-type that it performs. Quotation is examined from this perspective, and it is claimed that a speaker indicates a locution by means of quotation marks while performing an illocutionary act. The speaker (i) performs an illocutionary act pertaining to the locution, (ii) reports an illocutionary (or perlocutionary) act in another discourse by means of the locution by which the act was performed (or a part of it), or (iii) indicates a part of the locution of the present utterance, and thus signals a special sense or referent, or importance. Depending on the type of illocutionary act, the quoted material is imported into the discourse in a specific way.