Yes, dithering is a technique used to create other colors using different ones, like mixing paint.
I can't really teach u, I do it naturally now ^^' I just look at official in game sprites and manipulate my style to imitate those. Observing sprites are one thing that helps.
Hello! your sprites look amazing!
is dithering 1 way of adding shades into sprites? and could you teach me how to make RPG looking sprites like your Giratina scratch?