When you lie down you don't lay something else. Then it is lie.

If you lay something down, you use lay.

I like to lie in bed. Yesterday I lay in bed. I have lain in bed.

I lay the baby down. Yesterday I laid the baby down. I have laid the baby down.

Some people say they lay in bed (right now). It is incorrect but is seen as acceptable just because many people say that. It's not too much trouble if you don't use past tense, then it becomes trickier.

I would say that more people (especially Americans) say lay when they mean lie, more than people saying it correctly.