Skin
Skins are graphic files in The Sims and The Sims 2 which are used to represent the head, body and clothing of a Sim, but how they work in the two games is somewhat different. The wide availability of third-party skins has unquestionably contributed to the high visibility of the series.
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The Sims
Skins in The Sims are comprised of two parts per Sim: a head and a body. Both are simple bitmap images, numbered to correspond with the mesh file which gives them the desired shape on the Sim. Each image file is that Sim's entire body or head, including skin (there are 3 skin tones - light, medium and dark - and it is common for the same outfit to be made in all 3 tones) and hair. Some skins have accessories such as hats and glasses, which have separate BMP and mesh files.
Skins are available for different modes of dressing: Everyday, Pajamas, Swimwear and Formal. Some jobs also have "uniform" skins. There are also nude skins for when a Sim is using a toilet, using the Vibrate interaction on another Sim or is taking a bath or shower. (a censor blur appears on top of a naked Sim).
Unlike The Sims 2, The Sims does not distinguish between custom skins and those included with the game. All head skins and Everyday skins are available when aging a baby to a child, aging a child to an adult with the Age of Instant charm, or generating a townie.
Once created, a Sim's appearance is not editable from within the game, except for their clothes, which can be changed by using a dresser. Some third-party utilities let players change a Sim's appearance.
The Sims 2
With the advent of the full 3d environment in The Sims 2 (See Comparison between The Sims and The Sims 2), skins become more complex. Skins are still in BMP format but are now contained in a "package" file, which can be extracted (and compiled) with the included Body Shop tool.
A Sim's body is now separate from their clothing, and there are now 4 basic skin tones (light, medium-light, medium-dark and dark) with each skin tone's graphic files being divided by age and gender. This makes all outfits available to all Sims of the appropriate age and gender, regardless of their skin tone or body shape. This also means it is now possible to create distinguishing marks such as tattoos that are unique to a Sim, although in practice this is not economical for drive space.
Hair is also separate, with different colours and styles, and eye colour can also be set. These traits are carried in a Sim's genetics, and passed on to their children.
Sims can change their appearance through a mirror. Hair colour, hairstyle, facial hair (male teens and older only) make-up, glasses and face paint can be changed.
Clothing has also undergone changes. Not only is there far more detail, but when wearing their Everyday clothes the top half of a Sim's outfit can be made separate from the bottom half, or simply be one piece. The modes of dressing are Everyday, PJs, Underwear, Swimwear, Formal and Workout Gear. Pregnant Sims will wear maternity clothes, although this can't be assigned by players.
New outfits
The Sims: Hot Date introduced the ability to buy new outfits on community lots. This was somewhat limited, as Sims could buy new pajamas, swimwear, and formalwear, but could only have one outfit of each type at a time. (In The Sims, all wardrobes already contain all Everyday outfits, so there's no need to buy them.) The Sims: Vacation extended this to children, although kids don't have formal outfits. Players can have Sims try on outfits before buying them. The Sim will go into a changing booth, change into the selected outfit, and pose in front of a mirror. After a short time, the clerk will approach the Sim, and the player will be asked if they want to have the Sim buy that outfit.
In The Sims 2, the way Sims get new outfits is to buy them on community lots. Since they're bought for the household, not for the individual Sim, Sims can buy clothes for other ages, and for the opposite gender. Players can have Sims try on outfits for their own age and gender, but having them buy those outfits will involve using a clothing rack's Buy option, and finding them again.