The short answer
Most dry skin is ordinary. It comes and goes with the weather, the water temperature and the soap you use, and a good moisturizer makes it look and feel better. A few signs mean the skin needs a person to look at it, not another jar, and you will find them below. Most people will never need them.
Why it happens
Skin dries out when it loses water faster than it replaces it. Cold outdoor air does that. So does heated indoor air, hot showers, frequent hand washing, harsh soap and getting older. Some medicines leave skin drier too. In all of these cases the dryness stays on the surface, and the skin looks dull or rough, feels tight, and sometimes looks flaky or gray on deeper skin tones.
The trouble is that dryness is also what many other things look like at first. Something that needs a different kind of care can look like plain dryness for a while. A change somewhere else in the body can show up in the skin before anything else does. Dry skin on its own tells you very little, which is why it helps to know what else to watch for.
None of this is meant to alarm you. Dry skin is one of the most common things people ask a pharmacist about, and the answer is usually a routine and a little patience. The rest of this is simply where the line sits.
What helps
For ordinary dryness, the routine does most of the work. Use warm water rather than hot, and keep showers short. Wash with something mild, and only where you need to. When you get out, pat yourself with a towel instead of rubbing, and leave the skin slightly damp.
Within a few minutes, put on a thick moisturizer. A balm, which has little or no water in it, sits on the surface and holds in the moisture that is already there, so it works best on damp skin. Use a small amount and add more only if you need it. Wear gloves for dishes and cleaning, since water and strong soap take moisture off hands quickly. A humidifier in the bedroom can help in winter, and it should be cleaned on the maker's schedule.
Give a routine a fair try, and pay attention to what changes. Skin that looks smoother and feels more comfortable after steady care is behaving the way ordinary dry skin does. Skin that does not change, or gets worse, is telling you something.
One more habit is worth building. Look at your skin in good light once in a while, especially on spots that tend to give trouble, such as the hands, shins and heels. Catching a small change early makes a doctor's visit shorter and simpler.
When to ask for help
See your doctor if the skin is broken or bleeding. Splits that open up, bleed, or will not close need more than a moisturizer. Keep the area clean, cover it with a clean bandage, and get it looked at, especially if it keeps happening in the same place.
See your doctor the same day for skin that is hot, swollen, painful, or leaking pus, or a crust that forms over a sore. Do not put a cosmetic on it and wait.
Get redness that is spreading looked at too. A patch that stays a patch is one thing. Redness that grows over a day or two, or that moves outward from a spot, is another.
Mention itch that disturbs your sleep. An itch that wakes you at night, or that keeps you from settling, is worth a conversation, even if the skin does not look like much.
Ask about a rash that keeps coming back. If it clears and returns in the same place, or returns every time you use a certain product or wear a certain fabric, a doctor can help work out why.
Mention dryness that comes with other changes. If you are also unusually tired, unusually thirsty, or gaining or losing weight without trying, tell your doctor. Dry skin can be one small piece of a larger picture, and a simple visit can sort it out.
Call your child's doctor right away if a child has any skin change along with a fever. If you are unsure, call anyway. No doctor will mind that call.
If your skin changed after you started a new medicine, bring the bottle to your pharmacist and ask. Do not stop a prescription on your own.
It helps to bring a short list to any visit. When did it start, what does it look like, what have you been putting on it, and what medicines do you take. That makes a short visit much more useful.
The AHOTO note
Our jars are cosmetic. Golden comforts dry, rough skin and seals in moisture so it looks and feels softer. Pure Shea is one ingredient, cold pressed unrefined East African shea butter. Neither is meant for skin that is broken, bleeding or painful. If any of the signs above sound like you, put the jar down and call your doctor or your pharmacist first.