That looks like it's rusting through. The best thing to do is to leave it be unless you're prepared to have the metal cut out and new metal welded back in. Anything less in the way of repair will return and the appearance will be worse than if you left it alone. You're looking at the tip of a rusty iceberg. It looks okay from the back because you're not seeing the back, you're seeing the inner fender. Amervo showed you where these cars rust; they collect dirt and leaves so they rot from behind.
