I know I've posted this before, but since there's an interest right now in what to make from denim, I thought I'd show it again. This bag is made from 1/2" strips of denim and is knitted using a circular needle. The handles are made using the 'seam' up the leg and are just braided together. Enlarging the picture will show that the top of the bag is the waistband.
It's not a process I would choose to do very often. Knitting with denim is rather hard on the hands I found. I love the end result though!