It looks like your image is a jpg. In general, we recommend using pngs as they scale better. You might find our documentation on Recommended Image Sizes (click here) useful. Although that particular article discusses the Slideshow Widget, the guidelines are general.
If you search your Custom Theme for '-head' you will see a background being loaded from a URL (e.g., "background: url('...')"). You can change that URL to a new image, or add a colour in its place (e.g., "background: blue;").
I hope this helps,