Reactive Dye is a dye that can react directly with the yarn. That means that a chemical reaction happens between the dye and the molecules of the yarn, effectively making the dye a part of the yarn. Reactive dyes have good fastness properties owing to the bonding that occurs during dyeing. Reactive dyes are most commonly used in dyeing of cellulose like cotton or flax, but also wool is dyeable with reactive dyes. Reactive dyes are usually used when dyeing dark colors. Any color that washes out is "residual" dye that was not absorbed by the yarn; it is not "bleeding."
Direct Dye is a dye used in a process in which dye molecules are attracted by physical forces at the molecular level to the yarn. Direct dyes are most commonly used to dye lighter colors.