You will need:
1. a common backpack with a large main compartment, padded shoulder straps, and a coat-hook loop on the top.
2. a hydration bladder, $10 from Walmart.com http://www.walmart.com/ip/Cyclone-Hydro-Reservoir/17217805
3. an old pair of jeans with big legs (large or baggy enough that the water bladder can fit in the leg through the ankle hole, and fill up to capacity (2 Liters)
4. 1 or 2 cheap carabiners,
5. pair of shoelaces
6. needle and thread, scissors, knife
Note: for the one shown here, the denim water bag rests on the bottom of the backpack well enough, I did not need to add reinforcements, so the water bladder hose is routed through the open top of the denim bag, and through a reinforced hole near the shoulder strap of the backpack. This works well for me. The strap used to retain the hose is an old bicycle pump strap (velcro).
Step 1: Prepare the backpack.
Cut a small hole (size of US penny) in the right and left bottom corner of bag, for the water hose. You may want to delay this step until you see where you want the hose to go. ****Depending on hose length, you may need to have the hose come through the backpack at a higher point, so it's extended enough to drink from while wearing pack. The holes will also be used to thread strings through, and tie to the bottoms of the shoulder straps, for stabilizing the water bladder.
You might want to cut a reinforcement backing for the backpack, from a piece of cloroplast (campaign sign). Just use trial and error to cut to fit snugly in the back of the bag. You can poke holes through it and thread the coat loop or carabiner, and strings through it later.
I will add more photos later.