From RoboBlitz Editor Wiki
Decals are marks and patterns that you can apply to objects. They're unlike textures because they don't cover the entire surface of the object, and they're placed in the map like actors instead of being applied in the object's properties.
Decals can add a lot of life and detail to your level, so being able to place them well is an important skill.
Placing a Decal
Select a Decal in the Generic Browser, PROP_Hub.SealDecalMat is a good one to play around with. You can either right click and select Add Actor->Add Decal: <Decal Name> or you can hold down the D key and click in your level.
To select your decal you can click on this strange little vulture/dragon/horse thing icon. Rumor has it this thing has an explaination, but I couldn't find it. It looks like this:
You can move your Decal just like a static mesh, unfortunately it's kind of hard to resize decals with the widgets. I find it easiest to get into the decals properties and adjust the Height, Width and DecalRotation directly.
TODO Explain decal properties here.