I found this on flickr while searching for cool homemade Onesies and other one piece baby gear. It's a Japanese technique called shibori, a tie-dye process that's far older and superior to the Deadhead version.
I'm not quite sure how Japanese would view it, but in the US at least, shibori's got a bit of that "crafty old Berkeley lady with chopsticks in her greying bun and a hummingbird garden" kind of preciousness to it. Which is fine, but I'm just saying.
Something I'm realizing as I ride out this DIY obsession: there's a lot of homemade crap out there, too. For every sweet shibori Onesie or Gocco-printed Space Invader, there's a hundred Onesies with stupid slogans that sound like they were made with PowerPoint Presentation Wizard ["Life is a fine line. Changing baby: Good. Switching baby: Bad!"]. Iron-on printing paper's as much of a threat to good designers as microwaves are to good restaurants.
[update from a NYT article on mass-customization facilitator Cafepress, which I have often browsed but never bought from: "after many months, I was still my only customer."]