Lay out your shirt flat on the floor.
Cut out the sleeves
This isn't necessary, you can eyeball it, but I recommend drawing where you are going to cut the neckline. Make sure the neckline goes down to or almost to the bottom of where you cut the sleeve.
Cut out the neckline.
Cut strips at the bottom about 3 inches long, or long enough to tie in a tight double knot.
Tie the front and back strips together in a tight double knot. This is how it will look at the end.
This is optional, but I drew designs with sharpies. Or, you could use acrylic paint or fabric pens. Be sure to put a thick piece of paper between the front and back of the shirt to prevent bleeding.
If you don't want fringes, turn the shirt inside out as you work. When you have finished tying the knots, just turn it right side out again.