Also known as malletspace. A cheap gimmick often used in movies, it's especially commonly seen in the Sonic world, most notably by Amy Rose and her piko piko hammer, but also used by other characters when collecting rings, chaos emeralds and other objects. This feature is only available to characters in SegaStH. Characters of SatAMStH are required to carry backpacks, pouches, bags, etc. to carry their items in.
Hammerspace is most easily described as a sort of pocket dimension. Every character has their own personal version that any variety or number of objects/weapons can be stored in - within certain reason. A character can't simply pull absolutely any object they desire out of thin air for sake of convenience in a situation, it must be known weapons or items they have collected, or objects that would make sense for them to carry based on their personality or needs (Makeup, notebooks, etc). As a rule of thumb objects should be no bigger than what can be hidden behind the back.
Hammerspace can easily be taken advantage of and abused if proper responsibility by a player isn't taken, such acts being highly frowned upon by other players and considered godmoding and/or metagaming. While acceptable when used sparingly, abuse is not tolerated.