Summarize:

This dress will have an elastic sewn into the waistband, giving it a vintage-like cinch. The shirt needs to be baggy, not a fitted style. It also needs to be long enough to wear as a dress—at least mid-thigh length. Men's shirts are great for this! Turn the shirt inside out first. This will keep the outside clean. Put the shirt on, and make a mark where your waist is. You can use a pin or a dressmaker's chalk or pen. Take the shirt off when you are done. Spread the shirt on a flat surface. Use a straight edge to draw a line across it from side to side. Use the mark that you made earlier as a guide. Flip the shirt over, and draw another line on the back. This line will be the guideline for the elastic. Use a dressmaker's chalk for dark colored shirts and a dressmaker's pen for light colored shirts. Measure around your waist. Cut a piece of ⅜-inch (9.5-millimeter) elastic according to that measurement. Use black elastic for dark-colored shirts and white elastic for light colored shirts. If you can find a matching color elastic, that's even better! Fold the shirt's right side seam towards the back so that it lays flat. Pin one end of the elastic over the seam, aligning the raw edges. Make sure that the elastic is level with the line that you drew. Do not pin the rest of the elastic. Clamp the foot and needle down over the shirt and elastic. Give the elastic a tug, stretching it out. Backstitch once, then sew forward using a narrow zigzag stitch. Keep the elastic pulled taut as you sew. The fabric will gather as you sew.  Make sure that you are sewing the elastic over the line that you drew. Make sure that your thread color matches the shirt material. When you reach the left side of the shirt, press the seam down against the fabric. Sew right across the seam. Keep the elastic pulled taut. Continue sewing across the back of the shirt. When reach the right side seam again, overlap the ends of the elastic by ½ inch (1.27 centimeters). Sew back and forth across the two ends a few times. Knot the loose threads, then trim them down. Discard any leftover elastic. This is not really necessary, but it will give your dress a nicer look. Cut the ribbed collar off first. Next, cut the front part of the collar into a V-neck or scoop-neck. T-shirt material does not fray, but you can bind the raw edges off with bias tape or jersey fabric, if you'd like. Your dress is now ready to wear! For a cutter look, wear a wide belt over it to hide the waist seam.
Find a large T-shirt. Put the shirt on and make a mark where your waist is. Draw a line across the front and back of the shirt. Cut your elastic. Pin the end of the elastic to the shirt. Begin sewing the elastic to the shirt. Continue sewing the elastic to the shirt, flatting the left seam as you go. Overlap the elastic when you reach the end. Snip off the excess elastic. Consider modifying the collar. Turn your dress right side out.