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he knew it was not his baby
That is, “he knew that he was not the one who had caused her to be pregnant.”
to shame Mary
That is, “to cause Mary to be publicly disgraced” or “to embarrass Mary publicly.” Joseph was merciful to Mary, even though it seemed like she was an adulterer.
to divorce her quietly
This could also be translated as, “to divorce her without telling others why,” or, “to divorce her without telling others about her pregnancy.” Because Joseph was righteous, he wanted to resolve the situation in the best way possible, which in this culture would be to divorce her quietly.
divorce her
For some languages it may be better to say, “break their engagement.” Joseph and Mary were engaged or, “pledged to be married.” But in Jewish culture a divorce was required in order to break off an engagement.
in a dream
That is, “while he was asleep and dreaming.”