Perspective plays a crucial role in language, especially when thoughts or utterances are reported. Linguistic theory traditionally assumes that indirect discourse obligatorily reflects the context of the current speaker. The present study challenges this prevalent consensus. Combining theoretical analysis with experimental studies, it demonstrates that temporal indexicals in German indirect discourse can shift to the perspective of the reported speaker or thinker when specific conditions are met. The analysis identifies narrative context, discourse prominence and the semantics of propositional attitude verbs as key factors governing perspectival interpretation. By revealing striking parallels between indirect discourse and free indirect discourse, the book advances a unified account of perspectivization in reported speech and thought and offers the first systematic empirical investigation of indexical shift in German indirect discourse.