Thanks for the reply. Your edit is amazing!  

http://i57.photobucket.com/albums/g209/phototekcub/yellowguyedit.gif

There's the edit I promised, now for the breakdown:

First of all, I'll address your color choices.  I don't know if you used the mspaint default pallete, but it looks like it.  What this means is your colors are too saturated, lower the saturation on the entire pallete.  Secondly, the dithering doesn't really work on this piece, a simpler shading solution following a set light source is appropriate; yours doesn't seem to have a distinct light source.  As jalonso said, the yellow being lacks character, give him an expression of some sort, or add some sort of detail.  The shape of the head bothered me, it seemed to be made using the circle tool, which is generally a no-no.  I didn't change the head shape, other than make the circle shape less jaggy, but if this were my piece, I'd make his head a more complex shape.  And that is all I have to offer you, I ask that you take these suggestions to heart and try to gain something from the edit I made, and finish these piece with some changes.  Good luck, and happy pixelling!

Definetely shows effort on your part. However, its much too simple and lacking character. You may not evn need dithering on this. A simple shading style could work well. Check in the tutorial section or join the forum.

There are many issues with this piece, I will make an edit and elaborate soonish.