XML Shape Drawable for Dialog Backgrounds. Applies a fixed outer margin to keep background from fully stretching to screen edge, and allows for additional internal padding to apply to the dialog content.

background_dialog.xml

<?xml version="1.0" encoding="utf-8"?>
<layer-list xmlns:android="http://schemas.android.com/apk/res/android">
    <!-- Apply the margin value on the "item" element -->
    <!-- This example creates a 15dp visible margin around the dialog -->
    <item
        android:top="15dp"
        android:bottom="15dp"
        android:left="15dp"
        android:right="15dp">
        <shape
            android:shape="rectangle">
            
            <!-- Add attributes specific to your background (e.g. corner radius, colors, etc.) -->

            <!-- Set "padding" at minimum to match margin and add additional content padding as well, if desired -->
            <!-- This example creates 10dp of internal padding for content -->
            <padding
                android:top="25dp"
                android:bottom="25dp"
                android:left="25dp"
                android:right="25dp" />
        </shape>
    </item>
</layer-list>

styles.xml

<!-- Possible example of applying the background to your application dialogs. -->
<!-- You can also set the background directly on your dialog's content view hierarchy if you have customized the theme another way. -->
<style name="Theme.CustomDialog" parent="@android:style/Theme.Dialog">
    <item name="android:windowBackground">@drawable/background_dialog</item>
</style>

Helped me to realize how to add margins to shape drawables - just what the doctor ordered! Thanks.