I strongly recommend that when you make cloth dolls and their clothes, you sew them by hand. The small size of your pieces of fabric makes it easier to get the seam allowances even and accurately stitch around those tiny curves. I know that I am unable to machine stitch the very small curves and turns required with doll hands, feet and tiny sleeves.
To make your dolls and doll clothes as sturdy as possible, since they will probably be well loved by little doll lovers, I recommend using quilting thread. When I hand sew dolls and doll clothes I like to use a small quilting needle; they are often called "betweens" and I use size 12. This is a very tiny needle, but it makes it easy to make very tiny stitches. I try to put in 12 to 16 stitches to the inch. The tinier the stitches, the easier it is to make smooth, rounded curves. More stitches to the inch also makes your seams more durable.
When adding lace, ribbon or any type of decorative trims to your doll clothes it is much easier to make the stitches disappear when you sew them on by hand. of course, you must use thread that matches the trim, but when you sew it on by hand you are able to place the stitches individually where they are least likely to show on your finished product.
Additionally, when hemming your clothes, you can only make an invisible hem if you stitch it by hand. For help with making invisible hems, refer to Making Hems on Doll Clothes.
For assistance with putting yarn wigs on dolls by hand, see Sewing on Yarn Doll Wigs.
For instructions on putting hand sewn facial features on your dolls see How to Embroider Faces on cloth Dolls.
Making and Dressing Cloth Dolls
Ebook with patterns and instructions to make 5 cloth dolls as well as chapters on general doll making techniques.The book includes 21 inch Lalena Doll, 21 inch David Doll, Bear Dolls, 9 inch Destiny Doll and 15 inch Annie Doll, all together in one handy book. 53 pages.Making and Dressing Cloth Dolls.