From the Super Mario Wiki
Upon being used, the Reflect Shield will surround the racer's kart with a silver shield. Any items that hit this shield will be reflected back at the racer who used them. If a Reflect Shield user is attacked with a battering item such as a Thunder Stick, the racer who used the battering item will take damage. Racers who are under the effect of a Reflect Shield cannot pick up other items while the shield is active, unlike users of the regular Shield.
In Mario Kart Arcade GP and Mario Kart Arcade GP 2, the reflection of Mario Highway can be seen in the Reflect Shield when it is in use, regardless of what track is being raced on.