Yes, characters can and are developed through dialogue in stories.
As your books (or series) goes on, a character may mature in his/her speaking pattern.
For instance, if your character at the beginning of your book was a chatty person, then how to develop him/her could be to make him/her more quiet only comment when necessary, etc.
A conversation between characters is called a 'dialogue.'
dialogue
Conversation between characters is called dialogue
dialogue
A dialogue in opera is a conversation, which is sung, between at least two characters.
Dialogue.
The dialogue and actions between the characters.
Dialogue
ANSWER: Using Dialogue
Dialogue is the conversation between two or more characters of a novel, play or other literary work.
Why did Shakespeare use iambic pentameter for the dialogue of noble characters
Voice over is typically not considered dialogue, as it represents a spoken commentary or narration that is separate from the characters' spoken lines. Dialogue usually refers to the direct conversation and exchanges between characters in a scene.