A skin refers to the texture that is placed onto a player model or mob. (For example, the player can edit and make their own skin textures for the player model skin as well as the player's helmet skin.) A StarMade player skin allows for transparency, meaning anywhere a pixel is not placed the skin will be transparent. StarMade player skins also contain "emission" files (one for the player helmet and one for the player skin), and these files indicate what parts of the skin will glow and how brightly.
Changing StarMade Skin - Video tutorial
Making a custom skin
If you wish to make your own custom skin, save the image below and edit it: