Taken from Danis Finishing Tutorial
Now are the step-by-step instructions...
Step 1 :
After you have prepared your fabric (washing, zig zaging or necessary basting) select your lining fabric. In this instance since the fabric I stitched on was a light colour I selected a light coloured lining fabric. If you choose a dark fabric be aware that this may show through the fabric you did your stitching on, making it look dirty. Cut your lining fabric to match the size of your front and back stitched pieces.
Step 2:
If necessary press your lining fabric and stitched pieces.
Step 3:
First were going to turn the lining fabric into a little bag. With right sides of the lining fabric touching, sew together. Sew the two sides, when sewing the bottom be sure to leave an opening at the bottom of your lining.
Step 4:
Now its time to turn your stitching into a bag! Line up the front and back of the bag, right sides touching. Make sure where you have drawn threads out of your fabric line up perfectly, this is where youll be threading your ribbon later. If you have stitched a decorative cuff make sure your stitching lines up front to back as well.
Step 5:
Sew stitched pieces on sides and bottom. Do not sew the top shut!
Step 6:
Trim away any excess fabric. You dont want bulky seams. Also be careful not to cut away too much or your fabric might frey and your bag will come apart.
Step 7:
Cut the bottom corners of your stitched bag on an angle (careful not to cut what youve just done on the sewing machine). This makes it easier to turn those corners out later.
Step 8:
You now have two "bags" one made of your stitching and one made of fabric. At this time turn your stitched bag right side out, youll be adding the ribbon next.
Step 9:
Cut a very generous length of co-ordinating ribbon. Its better to have too much and cut off the excess then to realize at the end you dont have enough to tie a bow.
Step 10 :
Thread a large eyed needle with the ribbon. This makes threading the ribbon into your stitched piece much easier.
Step 11:
Starting at the center front of your stitched bag weave the ribbon through the area where you earlier removed some of the horzontal threads from your fabric.
Step 12 :
Keep weaving the ribbon into the fabric until you come back to the center front of your stitched bag.
Step 13 : Now turn your stitched bag inside out again. Tuck your ribbon inside. Also at this point you need to turn your fabric bag right side out.
Step 14 :
Now insert your fabric bag (lining) into your inside out stitched bag. The right side of the lining fabric should be touching the right side of your stitching.
Step 15:
Making sure your lining and stitched fabric lines up at the edges pin the stitching to the lining along the bags opening.
Step 16 :
Sew all the way around the opening using a 1/4 inch seam.
Step 17 :
Pull the lining a little bit out of the inside out stitched bag. Through the opening in the bottom of your lining pull the stitched bag through it. Emerging through this hole should be the right side of your stitching.
Step 18 :
Sew closed the opening you left at the bottom of your lining.
Step 19 :
If necessary press your lining.
Step 20 :
Stuff the lining back into your stitched bag.
Step 21 :
Sew along the top edge of the bag. I had clear polyester quilt thread in my machine so any difference in colour between the fabric and thread wouldnt stand out.
Step 22 :
You now have a fabric lined bag with a ribbon draw-string closure! Now for the finishing touches!
Step 23 :
Once again thread a needle with one of the ribbon end.
Step 24 :
Thread a co-ordinating bead onto the needle and pull it onto the ribbon. I still havent trimmed my ribbon at this point.
Step 25 :
Tie a knot into the ribbon below the bead so that the bead does not slip off of the ribbon. This is where you need to decide how long you want your ribbon. This knot will be a little higher than where you plan to cut your ribbon. Next cut your ribbon about 1/2 inch to 1 inch below the knot. I like to cut the ribbon into an inverted "V". This gives it a more finished look.
Youre done! You now have a beautiful bag you can stuff with stitching goodies or yummy treats!