Looks like you are shading painting with low opacity black or white over the colors.
It looks dull and can get very messy very fast. Some of the shading is too subtle to be noticed at first sight.
Pick a real color from the one you want to shade, lowering its brightness, usually saturation too, and shifting the hue (I usually go towards blue for shadows and towards yellow for highlights, but you can experiment with it.) until it's different enough from the other. It takes a bit of time for your brain to learn when it's enough or too much difference, but after you find your sweet spot you won't even think of these things anymore.
The black lines inside the sprite are taking a lot of space and give no information. The separation between parts would be obvious with the contrast between their colors already. For separating the white fur folds I would use a darker color and I would make each bigger than that.
Making the shapes and lines cleaner and rounder will make it look cuter and more accurate.
Not a bad start though. When you start noticing that kind of stuff you won't do it wrong again.
I've tried to make pixel pokemons sometimes and I've failed horribly
Useful info:
http://pixeljoint.com/forum/forum_posts.asp?TID=11299