How to wear a dhoti:
The dhoti is one long piece of cloth. Start by folding it in half so that it is half its original length.
Drape the dhoti behind you. The stripe should be vertical and held at the top by the left hand. The top of the folded side should be in your right hand and the dhoti should drape almost to the ground behind your heels.
Bring together in front of you the folded side in your right hand to meet the stripe side in your left hand.
Hold both the folded and stripe side in your left hand and bring them at even tension directly to your left side, keeping the bottom of the dhoti level and near the ground.
Hold the stripe side in your left hand as you accordion fold the fold side with your right hand until it is even horizontally with your left leg.
There should now be a folded bunch in your right hand. Slightly lift this bunch in your right hand as you bring the stripe side over it to your right side. The dhoti is now wrapped around you. What is left is adjusting the tightness and rolling it down to hold the tension in place.
Take the bunch in your right hand twist it slightly together and to the left and slip the top side of the dhoti just over the bunch to hold it in place.
Even up the stripe side so that the stripe is vertical and the dhoti drapes level just above the floor.
Roll the top of the dhoti down to a comfortable waist level, somewhere below the belly button.
Tips for comfort and convenience:
Dhotis do not have pockets, but they do have a roll at the waistline. It is possible to carry small items such as keys, cash, and some IDs by placing them in the roll. With some practice your items will be secure and easily accessible.
Be careful going up steps. It is easy to step on the dhoti, especially the left side (which is accordion folded). Lifting the bunched accordion fold higher before rolling helps alleviate this problem.
Silk dhotis do stay on. I was surprised because I thought their slipperiness would make them slip right off. I've danced the night away in a silk dhoti with no problem.
You do not need to wear undergarments with your dhoti, but be aware the fabric is thin, especially in the back. Wearing your white dhoti in the rain might be more interesting than you anticipated.
Wind can blow open dhotis and when you sit down the dhoti may come slightly apart. The more you overlap the fabric in the middle the less of a problem this is.
When you order a dhoti you will probably have to trim off the end. If there is a seemingly useless strip of cloth attached by threads to either end of your dhoti cut it off. This is just to keep the dhoti from fraying until it is sold.
Dhotis do stop fraying naturally. They do not just come apart after some time.
Dhotis are traditionally worn very near the ground, almost touching. If you plan on dancing in your dhoti, wrap it a little higher to keep it from being stepped on.
Fold the dhoti in half before drying it and make sure the stripes line up. When you take it out of the dryer it should still be folded in half with the stipes lined up. This is important for making sure the dhoti stays together well when it is wrapped