Make a double folded edge around the napkin. Fold edge all the way around and press with iron. Then fold the edges again and press with iron. Clip with sewing clips.

Once folded and pressed your ends should look like this before sewing.

Stitch down the sides. When you get to a corner turn the fabric.

Backwards stitch into the corners and then back down. This will make the corners stay down and have a nice edge when finished.

As you can see here the edges are stitched to both corners making it lay flat.

Once you have sewn all corners then press the napkin into thirds.