Direct object pronouns take the place of nouns in writing. We use them to stop repeating ourselves. For example:

I have a book. I give the book to Juan and he reads the book.

Tengo un libro. Doy el libro a Juan y lee el libro

This sentence says "book" 3 times. So we use direct object pronouns to replace the repeated word. For example:

I have a book. I give it to Juan and he reads it.

As we can see, it has replaced the word book, which reads far better in English. Here are the following direct object pronouns:

me - me

te - you (singular)

lo - him/it

la - her/it

nos - us

os - you (plural)

los - them (masculine)

las - them (feminine)

In this case, we want to say it, as we are talking about the book. It can be lo or la, but because we're talking about el libro, which is masuline, we use lo. So the sentence would read.

Tengo un libro. Lo doy a Juan y lo lee.