A glass closet is someone who is gay but claims they are straight, they will not come out of the closet, but it does not matter, because you can see that they are gay.
Or a closet that is see through due to it being made of glass.
Ex 1 - Person:
Gabe: Dude, you are such a glass closet.
Andy: Dude! I swear I'm not gay!
Ex 2 - Actual Closet:
Gabe: You can see the clothes without even opening this closet, that's so cool.
Andy: Yeah because its made of glass idiot.
A glass closet is a person or character who is gay but pretends to be straight, meaning they won't come out of the closet, but it does not matter, because its painfully obvious they are gay.
Or a closet that is see through due to it being made with glass panes.
Ex 1 - Person:
Gabe: Dude, you are such a glass closet.
Andy: Dude I swear I'm not gay!
Ex 2 - Actual closet:
Andy: Hey look at this glass closet you can see through it!
Gabe: Wow, this glass closet it so cool, I want one.