Abstract: The invention relates to a beach towel which can be converted into a bag for carrying various accessories. The towel is formed by an elongated sheet, to an upper central part of which a pillow assembly is secured. A pocket is formed between the flexible sheet and the pillow assembly to retain a folded towel after the pocket has been turned inside out. Secured between the elongated sheet and the pillow assembly are a pair of handles which become exposed on the outside after the pocket has been turned inside out.