Back in the 70s, t-shirt iron-ons were a pretty big fad. I remember at our local mall there was a joke shop (sort of like a prelude to Spencer Gifts except they had the "adult" items behind the counter) which also had an iron-on counter. You'd go and pick out your preferred color of t-shirt and bring it to the counter. There, they had all the iron-on images up on the wall that you could choose. They'd arrange the shirt and iron-on in an iron press and in about 30 seconds you had a brand new shirt to show off to your friends!
As you can see from these ads, you could also mail order iron-ons and apply them at home with your household iron. This was a bit trickier because you had to make sure the iron-on was positioned properly on the shirt. Also, the ironing could take a few minutes and you had to be sure to keep the it moving so you didn't cook the shirt and to ensure heat was applied evenly across the entire image to prevent corners from not being stuck down and a future cause of the iron-on coming off.
Inevitably the day would come when the shirt had been through he wash too many times and the image would start to crack and/or peel off. If you ever had an iron-on shirt, I'm sure you have at least one memory of peeling the cracked parts off the shirt.
Today, you can buy iron-on transfer printer paper in craft stores to make your own iron-on shirts. I've done this a few times for Star Wars Celebrations to make some unique shirts that no one else would be wearing.