After the arrival of Destiny 2 Season of Arrivals Umbral engrams are also added to the game. Umbral Engrams can be converted into any gear you want, however, it is quite tricky to actually use it so many players are not able to utilize it properly.
In order to use the Umbral Engram, you need to use it along with the Umbral Decoder and the Prismatic Recaster. Umbral Engrams can be obtained via Crucible matches or looting Prime Engrams.
After you have obtained an Umbral Engram, you need to focus it using the Prismatic Recaster. There are a number of types of Umbral Engrams you can focus on depending on the Prismatic Recaster, depending on the type and rarity of the loot you want. Once you have a focused it, all you need to do is decode it using the Umbral Decoder. Both the Prismatic Recaster and Umbral Decoder are located at the Tower near the Drifter.