I happen to come across this tutorial at 4 in the morning and thought it was very neat. This is brought to you via Howcast, the network that brings you little "how to " videos on just about anything. Just take a look below at the 2 minute video on how to make a dress from a button down oxford shirt with no sewing machine.
UPDATE: They have recently deleted video, so the instructions are below
Step 1: Choose shirt
Choose a shirt that is long enough to wear as a mini dress when the collar is held just above your bust line
TIP: Women’s shirts are best, since they have back darts. Shoulder darts, usually found on men’s shirts, will hamper the fit of your dress.
Step 2: Hold it up
Hold the back of the shirt with the collar over your chest and have a friend fasten the buttons in back. Then wrap the sleeves around your back. This is the basic dress shape
Step 3: Fit
Have your friend overlap and pin the sleeves together in back. Check the front to make sure it stays fitted and neat. If you don’t plan to keep the collar in front, cut it off now
TIP: If you’re using a short-sleeved shirt, there won’t be much to cut off.
Step 4: Cut sleeves
Mark and cut the sleeves in back, leaving several inches of overlap for buttons, buttonholes, and seams. Then remove the dress, cut the sleeves straight, pin them down half an inch, and hem each one.
Step 5: Lay out buttonholes
Lay out the buttons on the bottom sleeve. Draw four slits in a straight line along the edge of the top sleeve to mark buttonholes. Then cut slits just large enough to fit the buttons.
Step 6: Sew
Hand-finish the buttonholes by sewing completely around the edge of each slit with doubled thread
TIP:Use a sewing machine if you have one.
Step 7: Finish
Try on the dress and have your friend overlap the sleeves and mark where the buttons will go for a perfect fit. Mark through each buttonhole, remove the dress, and sew the buttons at each mark