Megillah, Chapter Four, Mishnah Seven
This mishnah teaches that priests who have something distracting on their hands, either a deformation or a discoloring should not lift up their hands because this makes the people look at them and not think about the blessing that they are receiving. The mishnah considers it crucial that the congregation focus not on the external attributes of the priest but the contents of the blessing that they are receiving.
We should note that today people refrain from looking at the priests hands when they are reciting the blessing and their hands are also covered with a tallit.
Since the mishnah is straightforward I have refrained from commenting below.
1) A priest whose hands are deformed should not lift up his hands [to say the priestly blessing].
2) Rabbi Judah says: also one whose hands are colored with woad or madder should not lift up his hands, because [this makes] the congregation look at him.