Mars is a planet located in the Milky Way galaxy, and is inhabited by Martians. It only appears in the episode "Out of the Picture," though it is mentioned in other episodes.
It is a large red planet that is found in space. The surface is covered in red sand, along with multiple red rocks. There are also many craters, including the one made in "Out of the Picture" by the rocket Squidward was in.
In "Truth or Square," when Squidward, SpongeBob, and Mr. Krabs remember the times SpongeBob has decorated the Krusty Krab, the last flashback features the Krusty Krab being space-themed. One of the lights inside the Krusty Krab is replaced by a model of Mars.
In "Mooncation," Sandy tells SpongeBob that after she finished fixing her spaceship, both of them are going to Mars.
In "Out of the Picture," it is the last location Squidward was sent to when he was delivering food. When he lands on the planet, he encounters three martians. He tells them that he has a delivery, causing one of the martians to grab the bag he is holding, get out the Krabby Patty that is inside, and eat it.
While the martian is eating, Squidward calls Mars "a dump," and says that it needs an artist touch. This angers the martians, causing one of them to eat him. They then travel back to Earth via a spaceship, and drops a goo-covered Squidward in front of the Krusty Krab.