This section is from the book "School Sewing Based On Home Problems", by Ida Robinson Burton, Myron G. Burton. Also available from Amazon: School Sewing Based On Home Problems.
Paragraph 128. The blanket stitch consists of even parallel stitches on the edge of material so looped as to cause a continuous line of thread to lie along the extreme edge of the goods. To do this, fasten the thread by inserting the needle about 1/4" from the edge of the material, and taking two or three running stitches to the edge, insert the needle again where the first stitch was taken and bring it out under the edge of the cloth over the loop of thread as shown in Figure 28; this will cause the first blanket stitch to fall so as to hide the running stitches first taken. About 1/4" to the right, insert the needle in the cloth again making it exactly even with the first stitch; bring it through under the edge of the material over the loop of thread as in the first stitch. Repeat until the edge is completely blanket stitched. In turning the corners take three stitches in one hole, making the stitches flare around the corner. In finishing the stitch fasten the thread by taking two or three running stitches under the last vertical stitch, as in Figure 29. A new thread may be started in just the same way that the beginning thread was started except that the running stitches are taken under the last blanket stitch made, so it is not necessary to make another stitch over them.
Figure 27.
Figure 28.
These stitches may be worked close together and used in making a scalloped or embroidered edge. They may be varied in width by making one long stitch with one shorter stitch on each side of it or by following the curves of the scallops.
The blanket stitch is used to finish raw edges. It is particularly desirable for finishing the edges of white flannel jackets and capes for infants. Worked with yarn, it is used to finish the edge of comforters. It is sometimes used in working buttonholes, but since it does not make as strong an edge as the regular buttonhole stitch it is not desirable.
 
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