Cancer that forms in tissues of the skin. When cancer forms in cells that make pigment, it is called melanoma. When cancer forms in cells that do not make pigment it may begin in basal cells (small, round cells in the base of the outer layer of skin) or squamous cells (flat cells that form the surface of the skin). Both types of skin cancer usually occur in skin that has been exposed to sunlight, such as the skin on the face, neck, hands, and arms.