First attempt at a custom sprite (Please give constructive criticism)

[NICKtendo DS]

It goes wrong at the very root. You seem to lack proper knowledge of anatomy and working from reference. The straps on Mario's overalls shouldn't go straight down, but follow the curves of his body. This shows that you also lack a sense of volume. Also noticed you dithered. I had to zoom in, because of the hardly notable contrast. Don't dither and add more contrast. You're not limited to MSPaint's default colors. If I go into further detail, I'd get cramp in my hands from typing.

I'm sorry, but eventhough it's a slight improvement, it's far from decent. Try to get the basics down first. Draw. Look at tutorials. Practice makes perfect. Don't take this the wrong way. There's a long, long road ahead of you.