A method in a wearable electronic device of detecting clothing includes: detecting whether the wearable electronic device is coupled to a user, determining whether the wearable electronic device is covered, and adjusting one or more device settings of the wearable electronic device. A secondary check can perform an additional determination of whether the wearable electronic device is covered with clothing. One or more sensors, such as a skin sensor, a tension sensor, an infrared sensor, or microphones, can be used to execute the steps in the wearable electronic device.