This was one of the first posts I ever wrote. I have learned to be more concise and to take better photos, so here is an updated tutorial for spring.
Just as in the photo below, fold a pair of your child's shorts in half and make a template adding in room on all sides for seam allowance. Cut out four from fabric.
Right sides together, sew the inside leg seams together. You will end up with two pieces now instead of four.
Open up the two pieces you've just sewn and lay them on top of each other with the good sides together. Sew up that big horseshoe in the middle.
Turn them right side out now so they look like a pair of shorts. The front and back will look exactly the same. Choose which side you want to be the back. This is where the ruffles will go.
(This is how they will look once you sew them on)
THE RUFFLES: Cut three strips of fabric for the ruffles, each 1.5 inches by 27 inches. Finish the long raw edges (or don't finish them and let them fray). The short ends will be tucked into the bloomers' side seam so you don't have to finish those.
Gather each long strip to ruffle it.
Sew each ruffled strip to the back panel of the bloomers, overlapping them slightly. Let the side edges of each ruffle hang over a bit so you can capture them in the side seams later.