The Diamond Helmet has been transformed into a Diamond Pauldron with update R31 in May 2016. It's to be expected that helmets will be implemented anew as a fourth piece of armor in future updates. Currently (R25 in November 2015) armor merely protects your player-character from the impact of physical hits from creatures, reducing the damage inflicted on the character. Diamond armor is the fourth (tier) armor-type that you can craft in Creativerse. Pieces of diamond armor can also be obtained occasionally when killing or taming and harvesting from a Thing.