How Do I Make My Own Hammock?
This page shows how to gather and whip a hammock, instead of tying a knot in the end like Ed Speer suggests in his Hammock Camping book. That way works fine, but whipping isn't as bulky, uses less material, and I can take my hammock apart to reconfigure how the ends are folded (by tightening up the hammock's long edges, for example). It's really just personal preference...both ways work.
If you're not familiar with whipping, start with this picture from this page to get an idea of how whipping works, then follow the steps below.