If someone sends you a message when you're signed in to Hangouts, a Hangout window will appear. To respond, type your message in the text box and press Enter.
Receiving messages from someone for the first time (logged in)
If the sender is in a Circle set to “Hangout with you,” you'll automatically receive the message. If not, you'll receive a Hangout invite.
Receiving messages from someone for the first time (not logged in)
If someone sends you a message for the first time while you’re offline or signed out of Hangouts, you'll receive an email and a Hangout invite. The email will include information about who wanted to Hangout with you.
Receiving messages in other situations
If someone sends you a message when you’re offline, signed out of Hangouts, have mute or snooze notifications enabled, or if you’ve turned off notifications for that Hangout, the message will appear bolded at the top of your Hangouts list until you read it. When you click on the message, a Hangout window will open and you can reply.
Read up to here indicator
When someone sends you a new message, you can let the person know you have seen it by clicking on your Hangout window. When you click on your Hangout window, your profile image will show under the message the person sent. Closing or minimizing your Hangout window will not cause your profile photo to appear.
When you first open a Hangout with a contact who is using the Hangouts app version 2.0 and above on Android, the contact’s status will appear next to the “Read up to here” indicator for a little while. Anytime you want to see the contact’s status again, you can touch the “Read up to here” indicator to display the status.