A.S.
This condition is most likely Keratosis Pilaris. It is hereditary and sometimes people just refer to it as "dry skin". I have this on the back of my legs and arms. Some regular lotions can help, but to really treat it effectively you have to exfoliate the skin gently on a regular basis. Doing this physically irritates the skin too much, so I had a dermatologist reccommend using a lotion with beta hydroxy acid/urea/lactic acid in it.
Links on keratosis pilaris http://www.aocd.org/skin/dermatologic_diseases/keratosis_...
http://www.helpforkp.com/keratosis_pilaris_about_kp.html
Lotions I have had luck with
http://www.drugstore.com/products/prod.asp?pid=16937&...
http://www.drugstore.com/products/prod.asp?pid=16753&...
These lotions used to be prescription. You usually can find them in the diabetic supply area of the drugstore near the pharmacy or in the lotion area, usually down low near the bottom shelves. It is more expensive than regular lotion and it smells a little funny, but it works wonders if you use it every day. Once it clears up you can even skip a couple days in between and you are fine. Makes your skin very soft and smooth.
Good luck!