Now we're finally going to get started! First thing you're gonna do is design your shirt! Draw an outline of what the shirt's gonna look like over top of the template.
DO NOT DO THIS:

What's wrong with this? These things:
1. Look at the outline, see how it hugs the outline of the template? That's not good. Clothes don't stick right to people's skin(unless it's a shirt made of gum or something but let's assume that it's not). It's okay to draw over the outline a little bit but you shouldn't JUST trace the template.
2. Look at the arms and waist. See how the lines are straight? This is bad. People's body's are round, not flat! So make sure that all of your lines are at least slightly rounded.
3. Lastly look at the collar. Just because it's called the collar bone doesn't mean the collar goes RIGHT on it. Look at the collar on the shirt you're wearing right now(or don't.. because unless you're a giraffe you can't see your collar bone and you're just gonna make yourself look stupid), it's either slightly above or slightly below your collar bone, so make sure you do the same when you sprite!
Something like this would be better:

Only problem with this one is that the lines aren't so smooth but don't worry so much about that because we'll be refining the outline later! But try to make it at least decent, if your rounded edges have points then you have a problem.
Look at all Showkaizers beautiful template...all of that shading on it's chest must have taken forever! Let's erase it! :D
I want you to take the second lightest color on the palette you're using and completely cover all of the chest that's within your outline.
Got that down? Good, now let's move on to shading.

shading the shirt already?!
No silly, shading the outline! Just because it's an outline doesn't mean it's not getting any light!
Take a look:

What you're going to do is take the 2nd darkest color and shade the outlines where the light would hit the sprite coming from the upper left(the upper left is always the light source when spriting). It's not hard at all, cross reference with mine when you're done to see if they're similar. If not, fix it ^_^
That upper shoulder's all the way up there on the upper left, right next to the light source! So it'd make more sense to shade it a lihter color right? Right. Because it's closer to the light you're gonna make it lighter! So Shade that shoulder with your middle color.

Lookin pretty snazzy. You may not see it now, but shading that outline is actually VERY important. If yours is similar to mine then good job! Let's move on to Step 3! ^_^