A reply is an answer, or a response. To reply to someone is to answer them. When they ask you something or tell you something, and then you say something in response, you're replying.
Your teacher might ask the class, "Are you ready for recess?" And everyone will reply: "Yes!" When you shout "Yes," that's your reply.
If someone writes you a letter or an email, and then you write back, you're replying.
Your reply doesn't have to be written down or spoken aloud. You could reply with a smile, a shrug, or a high five. Below, someone has asked Marissa a question. But instead of replying with words, she replies with a shrug, as if to say, "I don't know" or "Whatever."