Chrisjob on Curbly says:
Using a pre-made and readily available materials, it is quite simple to do quality prints for only $75 USD. The process works like this: A light-sensitive emulsion is applied to the screen. A black and clear image is placed atop the screen, and the screen is exposed under a photo bulb, which hardens the emulsion, except under the black image. Then the un-hardened emulsion is washed away, leaving the screen open only where intended. Brilliant.
Check out the great photo silkscreen tutorial by Chrisjob on Curbly. – Link.