Illustrator Make with Mesh on Veerle’s blog. There are all of these little tricks about illustrator I never learned and Veerle has a ton of tutorials for the eager designer.
Step 1 Create 4 lines using the rectangle tool
Step 2 Add color, reference Kuler for some killer swatch options. I used “Greenpeace Greenlife”
Step 3 Make a Mesh: select all lines and click Object> envelope. I used 4 columns and 2 rows. Pull and twist the anchor points with the Direct Selection Tool (A).
Step 4 Overlay Color Effect: I duplicated the layer with the mesh on top of my original mesh (ctrl+f, for a direct paste on top). Click the layer target circle icon in the Layers palette and change the layer mode to Overlay in the Transparency palette. Move the overlay layer until you reach desired effect.
Step 5 Play around with different effects. I used the warp option and added text by drawing a line with the pen tool and selected the Type on a Path tool to create curved text.
Step 6 To see more detailed instructions, visit Veerle and all of her tutorials.