Find an image you like and print or sketch it onto a piece of freezer paper. I design and prepare my stencils using Silhouette Studio software and my Silhouette SD desktop cutting machine.
I save my art in a vector format in this case .dxf and send it to the cutter. Picture is the stencil positioned on the T-shirt. (ignore the lone square cut out in the upper part of the stencil, that was something else :-/ ) Of course if you don't have these tool's you'll need to carefully cut out your stencil using an X-acto knife.