I made this project from Studs and Pearls! I love their website...changes that I made include: using glue instead of sewing, making the fabric appear loose, and placing one of the knots asymmetrically.
The blue one is my favorite of the two. :)
Take your headband, preferably one that is on the wider side.
Make a knot in the middle of your headband and glue it in place. On either side, use the glue to secure the fabric to the underside of the headband.
Allow it to dry, and you're done!
Now, check out my blog because I say so.