Skin cancer, a prevalent and potentially life-threatening condition, demands accurate and timely detection for effective intervention. It is an uncontrolled growth of abnormal cells in the human body. Studies are underway to determine if a skin lesion is benign (non-cancerous) or malignant (cancerous), but the biggest challenge for a doctor is determining the type of skin cancer. As a result, determining the type of tumour is crucial for the right course of treatment. In this study, we introduce a groundbreaking approach to multi-class skin cancer detection by harnessing the power of Explainable Artificial Intelligence (XAI) in conjunction with a customised You Only Look Once (YOLOv7) architecture. Our research focuses on enhancing the YOLOv7 framework to accurately discern 8 different skin cancer classes, including melanoma, basal cell carcinoma, and squamous cell carcinoma. The YOLOv7 model is the robust backbone, enriched with features tailored for precise multi-class classification. Concurrently, integrating XAI elements, Local Interpretable Modal-agnostic Explanations (LIME) and Shapley Additive Explanations (SHAP) ensures transparent decision-making processes, enabling healthcare professionals to interpret and trust the model's predictions. This innovative synergy between YOLOv7 and XAI heralds a new era in interpretability, resulting in high-performance skin cancer diagnostics. The obtained results are 96.8%, 94.2%, 95.6%, and 95.8%, evaluated with popular quantitative metrics such as accuracy, precision, recall, and F1 score, respectively.