Ah, some hand applique. It seems easier now. I did the one with the freezer paper on top method, and it seemed to work out ok. The fabric is by Heather Ross, Underwater Sisters in Aqua. I bought a pack of 6 inch charms of the whole line so you'll see lots more.
This post reminds me of Catalina Island. There were no octopi, turtles, mermaids or topless women swimming there, but the the color scheme of the fabric brings to mind the orange garibaldi in the blue ocean. Actually, I think this line is called Mendocino. I'll have to put that on my list of places to visit.