In the most common usage "be yourself" means "don't be fake", or "don't try to be like someone you think you're supposed to be." This phrase is more complement

In the most common usage "be yourself" means "don't be fake", or "don't try to be like someone you think you're supposed to be." This phrase is more complement than advice. The intent of the person saying it is, "I like you, and others will like you too." Occasionally, but far less common, it is actually meant as advice. This might happen when the person saying it has seen you (or someone like you) being stiff, awkward, or overly self-conscious when attempting some new skill. In this context it can be interpreted as, "don't stress", "don't over think it", or "you can do it any way you like." It's one of those phrases that only has meaning in the context of the person speaking, like the greeting "how are you doing?" (usually not an actual question, in the US). In most cases you can safely disregard it. Personally, I usually choose to interpret it as "relax, you're doing great," and if I ever say it that's how I mean it.