The girls from Charmed, dressed in their street-clothes?
A woman running around in medieval garb and a cloak, with talismans and bells dangling everywhere?
Or a coven of nudists, dancing in a circle around a bonfire?
Truth is, while all of these are exaggerations and stereotypes, they are also all completely acceptable!
One of the beautiful things about the pagan belief structure is the distinct lack of rules and regulations. You see, followers of paganism aren't like most religious people- they aren't required to wear elaborate robes or funny hats, or even wear a dress and stockings to church. They can wear jeans and a tee-shirt to a ritual, if that's what makes their little hearts happy.
So the all-important question- "whatever shall I wear?!" has now become a much simpler inquiry- "what makes ME feel magickal?"
First, to clear up some terminology- YES, skyclad does mean nude, nekkid, otherwise in a state of undress. It means one is clad by nothing but the sky. (Makes sense now, doesn't it?)
Many witches feel this is definitely the way to be during a ritual or spell. Some feel closer to nature free from both man-made materials and society's restrictions on nudity. Practicing magick skyclad can be quite liberating- many witches feel it frees them from the mundane world and brings them back to their essential beginnings. We come into the world skyclad and pure; performing rituals nude helps some witches bring these traits to their faith. It is a common belief in many pagan traditions that the nude human form is not only natural, but sacred.
A secondary reason for practicing magick without your clothes- when one is nude, your senses are heightened. Every breeze, the touch of every blade of grass, is stronger and more defined than it is when your body is shielded from the elements.
Practicing skyclad makes you vulnerable, not only physically, but emotionally. You become open to the universe, unprotected, unmasked. It may become symbolic of allowing the Divine and the World to see you as you really are. Living with nothing to hide often makes a witch stronger and more confident, both in their magick and their everyday life.
Some misconceptions about practicing skyclad- there is not necessarily any sex angle to performing rituals nude. Although most pagan traditions are not anti-sex (and in fact celebrate sexuality), and though some pagan traditions do involve sex (always encouraged to be safe, sane, consensual, and legal), the simple act of being naked is not necessarily a sexual thing. There have been many misrepresentations of pagans as sexual deviants, perverts, and promiscuous individuals, which is a problematic stereotype. Every group has flawed individuals, and paganism is no different- but to categorize all witches as devil-worshipping sluts is not only incorrect, but insulting.
Again, let me clarify- I define 'costumed' as clothed, but not in normal attire one would wear out on the street. Common examples are medieval attire, gothic attire, or wardrobe significant to a certain culture, such as the Greeks, Celts, Norse, etc.
Some witches dress themselves in attire that is "witchy" according to pop-culture, such as flowing robes and pointy hats. (Hey, whatever floats your boat, folks.) Often this is because they have associated these garments with magick their entire lives- it's what society as taught them makes a witch. And while I think these people could benefit from exploring the possibility of other things and not limiting themselves to these popular representations, if that's what makes them comfortable while practicing, more power to them!
Costumes and wardrobe are also frequently defined by the tradition a witch (or a whole coven) associates themselves with. Gothic witchcraft (generally, an exploration of the darker aspects of magick) has become increasingly common of late. And while it isn't necessary to dress "goth" to follow this path, many witches find it helps put them in the correct mindset. (And please, when I say goth, don't assume I mean the Hot Topic type nu-goth, or that I mean the dark-Victorian fashion, or any other particular scene. It is simply an expression of a dark, alternative style.)
Also, witches who follow Old Traditions, such as the Celtic Old Ways, often lean toward dressing in a period-appropriate costume for their rituals. For example, Norse pagans following a tradition that worships Odin might wear tunics and chainmail, or perhaps furs and leather in their ceremonies, while someone practicing Egyptian magick might dress in flowing white fabrics with gold jewelry and elaborate headdresses.
Many pagans incorporate charms and talismans into their ritual-wear. (I knew a girl who wouldn't even cast circle without her favorite quartz-crystal!) Some of the most popular themes I've come across are strength, wisdom, protection, and arcane power. This is cool. I like this. Especially when either the witch has made the charm themselves, or it has been given to them by someone important to them. The only issue I have with this tradition is that often, the charms and talismans become more of a superstition or lucky-charm than an actual magickal tool. One can become reliant on the physical representation of, say, a protection spell, rather than the concept itself. Some may even feel unsafe practicing without it. While this is clearly not always the case, it can be a problem and witches should be aware of it.
Dressing up for a ceremony or spell can become a part of the ritual itself. Taking time to prepare yourself, focus your thoughts and energies, clear your mind from the day... It can be quite beneficial to your magick and/or worship. I would highly recommend trying it to those who have trouble focusing.
On the downside, coming up with a witch's wardrobe could be quite expensive. (I know corsets are quite popular, and they run you a pretty penny...) If you have limited income, maybe try making your own cloak or tunic! You can learn simple sewing through classes, friends, books, or the internet, and nine times out of ten, it will save you a lot of money. One can find patterns online or in craft-stores, especially around Halloween!
When I use the term 'clothed,' I am referring to street-clothes, something one would wear out and about on a daily basis. (For example- jeans, teeshirts, sneakers, work clothes, whatever.)
I have come to find that practicing magick in "normal" clothes is particularly common among more experienced witches. When one has been a practicing pagan for quite some time, magick often becomes a part of every-day life. In some cases, this allows a witch to let go of a desire for ceremony, and the need to separate their pagan world from their mundane world. "Full-time" witches can worship their gods and goddesses on any street corner, cast a spell in the middle of their work day, and feel witchy in whatever they're wearing!
Practicing clothed is also quite practical and affordable, so for witches with limited income, this makes life easier! No need to spend money on robes or talismans- just wear something you find comfortable.
Also, like any other human group, there are some witches who are not 100% comfortable with their bodies, and prefer not to be nude. While I encourage them to explore that and work to accept themselves as the beautiful children of the universe that they are, if one is distracted by insecurity and discomfort, it is probably not going to make performing rituals any easier. Whatever makes you feel good, go with it!
In short, my only advice is this- go with your gut. Don't force anything that doesn't feel natural or right to you. If you want to practice GothCraft, but you're too busy fiddling with your steel-boned vinyl corset to remember to call the elements, perhaps that's not for you. What puts you in a magickal mood? Remember- that's what is important.