Have a bunch of old towels that still have life in them and can be used for something crafty? Here are several tutorials and ideas to get you started, plus the original list of ideas first published on Tipnut is found at the bottom.
Mat Tutorial : Made with two old towels and blanket binding or fabric remnants.
Terry Cloth Caddy : Made with a hand towel and grosgrain ribbon.
Spa Slippers : Made with a pair of old flip flops, an old towel, polyester batting and a bit of faux leather.
Recycled Bath Mat : An old towel is used to pad a woven fabric topped bath mat.
Easy Bath Apron : This easy-to-make bath apron gives you a layer of protection – and your baby a comfortable place to dry off.
Baby Bundles : Made with a hand towel and trim, this is a pocket organizer that rolls up holding baby’s goodies.
Unpaper (Reusable) : Made with terry cloth and flannel, snaps can be added (optional) so they can be attached to each other and rolled around an empty paper towel tube.
Upcycled Beach Bag : A quick & easy project using an old towel and scrap fabric for the handles, minimal sewing involved.
Beach Blankets : Great idea for thicker towels that are still in good shape, squares are sewn together with a flat seam.
Also see these tutorials  for making hooded towels.
10 More Ideas
(original article, published December, 2006)
- Cut down to size for washcloths, dishcloths and hand towels. Either serge ends or hem. Pack some in the car too, great for cleaning up spills or wiping down the dash while you’re stuck in traffic. For very thin towels, you can double up the towel.
- Make yourself a spa headwrap, pattern: free spa headwrap pattern  on this page.
- Whip up a few pet blankets, pet bed liners, pet pillows. If you’re bursting at the seams with old towels, check with animal shelters and vet clinics–they may be happy to take them off your hands.
- Cut in strips sized large enough to use as cleaning rags. Use for household cleaning as well as washing your car.
- Make dusting or bath mitts, simply trace an outline of your hand adding a 1/2″ seam allowance and then sew.
- Make potholders  and use the old towels for protective batting.
- Make hot water bottle covers , nice and cozy!
- Make beach bags & totes  that are ideal for the beach, swimming lessons or hanging laundry bags.
- Quilted slippers – with old towels used as the batting, your feet can breathe better and won’t sweat as much.
- Make huge floor throw pillows for the kids while they watch tv. Try granny squares or striped patterns. Comfy!