So 'lay' always has an object, and it means 'put something or someone down carefully' – normally in a flat position.

When I eat I lay a cloth on the table.

You can lay a baby in a cot.

The past tense is 'laid', but careful with the spelling.

I laid all my cards on the table.

The verb 'lie' doesn't have an object and it means that you are 'in a flat position' or you 'put yourself in a flat position'- so you move on your own.

Tonight I want to lie on the sofa and watch a film.

But be careful.

Now, the past of 'lie' is 'lay'.

Yesterday I lay on the beach and read my book.