I heard someone say:
She's having loose motion.
I couldn't get it. So then asked it from one of my friend, and she said, it's a synonym of diarrhea. Is that a correct noun?
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Motion can indeed mean
a)the evacuation of the bowels
As you will see this is primarily a British English usage.
Given the response you received on inquiry, 'loose motion' will indeed have meant diarrhea (or as it is spelled in British English, diarrhoea)
The Oxford English Dictionary has this (note the one I put into bold);
11.11 The involuntary action of the intestines, leading to discharge of their contents; an evacuation of the bowels. Also, chiefly in pl., that which is evacuated; the fæces.
1598 Shakes. Merry W. iii. i. 105 Shall I loose my Doctor? No, hee giues me the Potions and the Motions. 1766 [Anstey] Bath Guide ii. 50 We must swallow a Potion For driving out Wind after every Motion. 1786 R. Willan in Med. Commun. II. 118 He had‥two or three loose motions. 1843 R. J. Graves Syst. Clin. Med. x. 111 Those who are dissatisfied with less than two or three motions in the day. 1871 G. H. Napheys Prev. & Cure Dis. iii. ix. 995 The motions of the bowels present a pale drab or clay color. 1897 Allbutt's Syst. Med. III. 737 In sprue the motions are generally very frothy.