My home has been invaded by small stuffed ghosts, just in time for Halloween! They are very soft and squishy and not spooky at all. (Don't tell them I said that, though.)

Supplies

small amount of white minky fabric (or flannel or thin terry cloth) - 1/4 yard will make several ghosts
scraps of fabric for eyes and details OR you can draw the eyes with a permanent marker
stuffing (aka polyester fiberfill)
a water or heat erasable pen (I like FriXions, but any erasable fabric marking pen will work)
sewing supplies
(optional) hemostat

Step 1: Cut Out Your Ghost

Open the PDF file. You'll see it's a pattern for both styles of ghost (arms up or arms down). Print it out, then cut out the ghost you want to make.
Lay out your fabric with the backside up, and the fur running top to bottom. (That's the direction the fur feels softest when you pet it.) I've marked the fur direction on the back of my fabric with an arrow - you can see it in the upper right corner of the first image.
Put the ghost pattern on the fabric, making sure it's at least 1/4 inch from the edge. Also make sure the fur will run downward. (Unless you want to pet your ghost upward?) Trace around the ghost with your erasable pen, including the dart (the V shape on the head) and also mark the section to leave open for turning.
Flip the pattern piece over. Put it next to the first piece, leaving at least 1/2 inch between the two ghosts. Trace around it again.
Cut around the two ghosts. Important: this pattern does not include seam allowance. You must leave 1/4 inch of fabric outside the line. You don't need to cut out the dart in the head or the space between the arms and the body.

ghosties.pdf
Download

Step 2: Sew the Head Darts

Tip for beginners: a dart is a v-shaped seam which gives the finished item a curve. In this case, it makes the ghost's head more rounded.

Fold the fabric along the dart with the furry side inside, and pin it as in the picture. Do this for both ghost cut-outs.

Then sew from the top of the head down to the point of the dart, along the line. Because the seam is so short, I usually sew over it twice instead of backstitching.

When you're done it should look like the second picture.

I sewed these on a sewing machine, but you can sew by hand using back stitch if you'd rather. It'll just take longer.

Step 3: Add the Eyes and Other Details (optional)

Sewing the eyes and other details on by machine gives a nice, neat finish. If you want to do that, you need to do it now. However, you can wait until the end and sew them on by hand if you'd rather. Or, you can draw them with permanent markers at either step.

Pick one ghost cut-out to be the front. Decide what details you'd like to add. Some ideas: eyes, mouth, heart, bow-tie, kitty ears... the sky's the limit!
Feel free to cut patterns out of paper if you like, then move them around on the ghost to decide on the best placement. Remember that fabric cut-out includes seam allowance - keep your eyes inside the traced line on the back. Also remember that the fabric will curve when the ghost is finished, so if the eyes are too wide they may wrap around the sides of the ghost.
If using markers, put a piece of paper under the ghost cutout in case the marker bleeds through. Then, just draw whatever you'd like.
If using fabric, cut out each piece and pin it in place with a single pin.
Carefully stitch around each eye or other detail. (Go slow! Use the hand wheel. Stop and turn the fabric frequently.) Use a thread that matches the color of the fabric you're stitching on so it won't show, or use white if you want a contrast.
If you want to stitch ears (or antennae maybe) into the seam, position them along the head, then flip them so they point inward as in the photo.

Step 4: Sew the Main Seam

Put the two pieces of fabric furry sides together. Line up the darts at the top of the head, and try to line up the rest of the edges.
Put pins around the seam with the pins pointing outward.
Find the two marks for the section to leave open. Start at one mark and sew the long way around on the traced line. Remember to backstitch at the start and end of the seam.
Go slowly around the curves. Stop and turn the fabric if you need to (you'll definitely need to at the point where the arms meet the body.)
Now, check your seam. Furry fabric can slide, causing gaps. Get a blunt tool like the eraser end of a pencil or the handle of a crochet hook, insert it into the opening, and move it along the seam testing for holes. If you find one, sew over that section making sure to overlap the rest of the seam on both sides of the hole.

Step 5: Clip the Curves and Turn the Ghost

Using a small pair of scissors, cut into the point where the arm meets the body as close to the seam as you can get. Cut each layer of fabric separately.
Now, cut into the fabric from the edge toward the seam at intervals along all the curves, as in the first two pictures.
Turn the ghost right-side out. If you have a hemostat, it's very helpful - insert it into the opening, lock it onto the fabric at the head, then pull. If you don't have a hemostat, you should be able to pull the fabric through the opening with your fingers, or you may find a pair of tweezers or small pliers to be helpful.
Use a blunt tool like the eraser end of a pencil or the handle of a crochet hook to push out the arms and the points at the bottom.

Tip: clipping the curves (and especially the point between the arm and the body) keeps the fabric from bunching up when you turn it right-side out.

Step 6: Stuff and Close the Ghost

Pull off small pieces of stuffing, and use a blunt tool or your hemostat to push them into the ghost. Push a blob of stuffing into each arm, then fill the head, then the bottom corners, then fill in the middle.

Once you're happy with the squishyness of your ghost, close the opening using ladder stitch with white thread.

Tip: If you don't know to do ladder stitch, here's a video I found on YouTube. This isn't me.

Step 7: Final Details

If you didn't put a face on your ghost before, hand sew it on now. Hide the knots under the piece you're stitching on, and use whatever stitch you like the look of.

Or, draw the face with permanent markers.

You can add ears at this point too - whipstitch them to the top of the head.

And of course you can add any other details your ghost needs or wants.

Now run your ghost through the washing machine and dryer (use a cold, gentle cycle and low heat). This will erase the marker you used to trace the pattern onto the fabric.

And finally, if you'd like to hang your ghost up, add a loop of thread. (Black thread will be hard to see at night, and clear nylon will be hard to see all the time.)