Bags from towels
So that would include towels.
Although I hope you get more creative than this, it's a stepping stone.
From Make it with Towels, Cannon Mills brochure.
No date listed.
(sorry for posting this a second time, but it's applicable again)
(click on image to enlarge. Flickr doesn't size horizontals well)
From "The How To Book: Do it Yourself with Stevens Utica Sheets & Towels", by J.P. Stevens & Co, 1978