Why not stitch directly on the towel? Use tear-away on the back and WSS on top.

If you ultimately decide to use the applique method, keep in mind that the "patch" will be slightly raised over the fluffy towel. Make the fabric piece large enough to fold under the edges to prevent any frayed edges from making an appearance (esp.) after repeated washings. (Hint: practice first!)

I usually make a open cross hatch filling, like an fsl background but less dense so it just holds the loops of the towel down, same shape as the embroidery, colour of the towel and leave out the underlay of the design. I use water soluble stabiliser at the back, so I end up with a design that is pliable and yet does not sink in the loops or gets misshapen after a lot of laundering.
Easy for me to do in my software, especially if I made the design myself.

I'm going to be watching for responses too. All of the towels I have bought already embroidered are thick from the stitching and curl or buckle up after washing. I'm afraid to try to make my own if they all will look like that and I don't have time to iron my towels and dish towels after every wash.

I would use a medium weight tear away on the bottom and WSS on the top, but I would be interested to see how yours turns out.

Hi there, I would then do it on the fabric and then applique with a frame onto the towel.
So that you are not just stitching the patch onto the towel.

Hugs Yvonne

Very interesting question camylow. I have tried two methods. I stitch out on satin and use 2 layers of vilene back to back - sticky sides facing out, if the design is not completely filled, like a butterfly. Cut around butterfly and iron onto towel. Using a small zig-zag stitch in a corresponding colour attach it to the towel, making sure my underside stitching is same colour as the towel and it's hardly noticeable. I have also used stitch-outs on a plain coloured fabric cut into a square and stitch a thin satin ribbon all around as a border to attach design to towel or any other item - a good way to use up good test stitch-outs. I only use small 4x4's. Hope you get some more ideas.

I have done some towels lately - borders near the bottom. I find that even with vilene on the top the stitches still sink (and the back looks better where the sticky vilene was - than the front). I think for a heavier design I would do the fabric and then sew it to the towel as a patch. I would use a color thread to match the towel in the bottom so it is not as noticable when stitched to the towel. I would put heat/bond or some other double side fusible on the back of the fabric. That will seal it to the towel when you are done.

I might try using a lightly "embossed" rectangle, circle..whatever the frog design would fit into to hold down the towel pile..then embroider the frogs over the embossed area using WSS on top...if we could see the design, it might help...

click on my name i have made a few towels you might get an idea there hugs

Deanna - I have done loads of towels in the past and have never had any problems with sinking stitches. I hoop medium tearaway, stick the towel on to the tearaway and put WSS on the top.