When the sheath has dried, take three or more small nails and tack it down on a board. This will hold the sheath firmly in place while you take a leather awl and poke holes around the outside edge of the sheath. Pictured below: Punching holes in knife sheath that is tacked down on a board to hold it in place.
Next you will need to sew the sheath together using artificial sinew, linen, or some other type of heavy thread. Sew all the way around the sheath in one direction and then sew back in the other direction. This will give you a solid line of stitching. Tie the ends of your thread together with a triple knot and use the point of your awl to shove the knot between the front and back layers of raw hide so that the knot is hidden. Pictured below: Sewing the sheath first in one direction then back in the other.
When the sheath is sewn together you can take a pair of sharp scissors and cut the outside of the welt into fringe. Pictured below: top, Cutting fringe;bottom, fringe completed.
You could call the job done here and put a neck cord on the sheath; but if you want a more fitted look to the sheath you need to put it in some water and let it soak over night and soften back up. Pictured below: Sheath soaking in water.
While the sheath is soaking you can prepare your knife for insertion into the wet sheath.
First take some masking tape and cover the point and cutting edge of the knife.
Next wrap the knife inside of a sealed plastic bag and place some tape around the bag to hold it in place. The tape covering the point and blade will keep the knife from cutting through the bag.
When the sheath is thoroughly soaked and pliable, push the covered knife down into it, then take a couple of nails and tack down the top edge of the sheath so that it doesn’t wrinkle up as it dries. Set the knife and sheath aside to dry for a couple of days.
After the sheath dries you can remove the knife and take the bag and the tape off of it. You will need to trim up the top part of the back and punch a couple of holes in it where you can attach a neck cord. Twisted or braided brain tan leather makes a nice cord. Pictured below: Finished neck knife sheath.
And there’s your finished product, a good looking neck knife sheath that you made yourself. No one would ever guess that it started out life as a dog’s chew toy.