Drywall can be used in a bathroom but not in a shower.
When covering the walls in a shower you want to use Durock cement board which is waterproof.
Then you tile over the durock or install a shower surround or shower covering on the wall.
If using sheetrock in the bathroom itself be sure to get sheetrock that is suited for wet and damp areas .
Regular sheetrock will mold and can fall apart in a bathroom due to the humidity from the shower.
Durock or cement boards are a highly moisture resistant building material that can withstand the damp conditions found in bathrooms and showers, where water can accumulate and seep into the walls over time.
Cement board is the perfect base for tiling, as it's waterproof and provides a smooth, even surface that won't be disturbed by moisture.
To fasten and install Durock cement board place the cement board panels with joints staggered from subfloor joints.
Fit ends and edges closely but not forced together.
Fasten panels to subfloor while the adhesive is wet with 32 mm (1-1/4") CGC Durock Wood Screws or 38 mm (1-1/2") hot-dipped galvanized roofing nails spaced 203 mm (8") o.c. in both directions.
Unlike wood-based materials such as plywood or products that contain some wood such as drywall, cement board lacks organic matter, making it impervious to mold, rot, shrinkage, or decomposition.