My daughter and I have been making small ghosts out of cheesecloth and hanging them from our chandelier and around the house.  Just cut up some cheesecloth into squares that are about a square foot and layer about three squares on top of one another.  Make a small ball out of crumpled tissue paper and put it in the middle of the square, wrap the cheesecloth around it to make a head, and use yarn to tie underneath it.  Then spread out the different layers and add a face.  You can get cheesecloth at most grocery stores.