He might be bald and might be scared that the cal-de-sac would make fun of him
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It is a mystery and will forever remain that way.
It has never been revealed. Many people will tell you that Edd has slicked back hair as seen in the "Lunch Room Rumble" game on the CartoonNetwork website, however, this is NOT part of the Ed, Edd n Eddy canon as the game wasn't created by AKA Cartoon (The makers of Ed, Edd n Eddy).
He wears a trilby hat that some people still wear (the style)
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A Trilby hat or Deerstalker hat.