An absorbent cotton fabric typically used for towels and bathrobes; toweling.(noun)
Wiktionary.org : Text is available under the Creative Commons Attribution-ShareAlike License
Use "terry cloth" in a sentence
"She might as well have just unwrapped the cuddliest, smallest, palest yellow terry cloth lamb, its eyes embroidered on so it held not even the remotest danger of a loose button that could be sucked down a windpipe."