Skip to Content

DIY Gift Bag from a Hand Towel

Sharing is caring!

How to sew an easy reusable gift bag using hand towels! This is a great way to upcycle cute hand towels that you’re not using.

Sometimes you end up with a pretty ridiculous number of hand towels, particularly seasonal ones, and they are EASY to upcycle if you’re interested. You can turn them into all sorts of things, including reusable gift bags like these!

The hand towel in the picture is actually from the Dollar Tree; I’d planned to make bags with these last year and life got away from me.

Learn more about grommets and how to install them.

This post may contain affiliate links which may earn me commissions should you click through them and take certain actions. As an affiliate for Amazon, Cricut, xTool, Home Depot, and other sites, I earn from qualifying purchases. Please DIY carefully. View my full legal disclosures here.

Please read the whole post so you don’t miss any important information!

DIY Gift Bag from Dollar Tree Hand Towels

Here’s a video for the project:


  • Dollar Tree Hand Towel
  • Scissors
  • Grommets
  • Grommet Press
  • Coordinating Fabric For Band
  • T-shirt Yarn Or Ribbon


  1. Cut your towel in half.

2. Face right sides together and pin.

Cutting the Dollar Tree hand towel in half.

3. Sew along the sides and the bottom.

4. You can stop here or add a boxy bottom like I did.

5. Cut a band. Mine is 5.5″ tall so it will be 2.75″ tall when folded over. Cut it the width of your bag (both sides).

6. Place your grommets (see grommet tutorial for more info).

Cut the band for the bag. Add grommets.

7. Sew your band right sides together.

8. Fold band over, wrong sides together.

9. Pin your band in place with grommets in front.

10. Sew on your band. Don’t hit the grommet!

11. Top stitch the band and sew a casing.

Sewing the band onto the bag.

12. Sew the casing.

13. Use a small safety pin to feed your ribbon or t-shirt yarn through the casing.

14. Feed the t-shirt yarn through.

15. Tie the ends of your ribbon or t-shirt yarn.

Please share and pin this post! If you make this project, share it in our Stuff Mama Makes Facebook Group. We have regular giveaways for gift cards to craft stores. You can also tag me on Instagram @doityourselfdanielle; I love seeing everything you make!

How to make a reusable gift bag with a hand towel.  Gift bag and the hand towel it was made from side by side.
How to make a reusable gift bag with a hand towel.
How to make a reusable gift bag with a drawstring. Overhead shot of the drawstring area of the bag.

Sharing is caring!