The decal needs to be
256x256 and needs to be
transparent, unless you want to figth
Flambeed... This can easily be done with
paint.netExample of a face decal:

Now you need to create the zip file, to do that right-click on your desktop, select "new" and there should be a list.

Select "
WinRaR archive" or "
WinRar ZIP Archive" and name it
Face_decalname.zip. Decalname is what you want to call it. (if it's a chest decal you replace "Face" with "Decal")
Now right-click again and create a
new folder, name it "
thumbs".
Put the new folder in the zip and then drag your face decal/decal to the zip. (do not put it in "thumbs")
Done :P