You're relying too much on lines, and putting shading in just as an after thought, mostly in a pillow shade manner. Not horribly pillow shaded but I can see where in many places you just threw some shading against the lines. This makes the entire thing look flat.
Your lines don't show the care and craftsmanship that makes pixel art look good. Sculpt each lines until it has the shape you want it to have, you cant just lay down a line, clean up any extra pixels and call it good.
There is too much going on, the entire thing is quite confusing unless you analyse it. Remove some mushrooms, and keep only one type of mushroom. Having green, red, and brown ones is confusing and doesn't help the piece.
Use silhouette to help define and clarify your monster. See if you can get someone to understand the form with the silhouette alone. Your current silhouette is a jumble.
You're using way too many colors, and you're not getting the potential out of any of them. When things don't look right with the colors, it is tempting to add more inbetween colors to ease the problem, as you have done, but it won't solve it. The problem is with the combinations of colors, and the more you add the more difficult it is to control and fix. 47 colors is a LOT of colors, look how many the main character sprite has.
You are really neglecting hue shifting, and that is steamrolling your piece into flatness. It is more or less unacceptable to change the luminance without changing the hue and saturation.
Related, is that you're lacking contrast in lots of areas in the piece. This is relevant to the pieces flatness, it's confusing nature, and it's inability to blend with the rest of the stuff. To fix it, you need hue shifting and bolder color choices. Taking the primary color of an area, dropping the luminance a bit, and using that to outline is not acceptable! You need to play with the colors a lot, to figure out what works. Drop the outline color of something way down, see how it looks. Bring it up some, see how that looks. Make it purple, see what happens. My point is, experiment with the colors a lot and without fear. This can only be done if you keep the color count low, but if you keep it low then the piece will end up much crisper and nice looking.
I'd like to have done an edit but messing with 47 colors is too time consuming. Hope these tips help though, good luck.