In “Final Fantasy VII”, each Materia is unique and different. However, most Materia only has one use or purpose, such as the Fire Materia which can be used to cast Fire, nothing else. In the same respect, the All Materia is used to target all enemies, but has no other practical uses. This is not the case for the Enemy Skill Materia.
The Enemy Skill Materia is very unique in the fact that upon first obtaining it, the Materia will be completely empty and have absolutely no use at all. As the story progresses though, the player will find that the character equipped with the Enemy Skill Materia can learn certain attacks or magics used by enemies, that would otherwise be unattainable by the player.
The Enemy Skill Materia, when equipped to a player, can essentially mimic specific moves of certain enemies throughout the game. The player must be attacked by the move and survive in order to learn it, and once learned, the character will have that move as a selectable spell under the E. Skill command in the command window.
Enemy skills learned via the Enemy Skill Materia can potentially wind up being stronger than some Magic Materia, and certain skills can only be obtained once or twice in the whole game before it is impossible to learn for the duration of the playthrough.
There are a total of 4 Enemy Skill Materias in the game, with the only way to obtain more being via maxing out the Materia. To max out the Enemy Skill Materia, the player must learn every single possible enemy skill in the game. Each enemy skill learned adds 1 star to the Materia, and once maxed out, will duplicate and create a new Enemy Skill Materia, just the same as other Materia.