What would Irwin Shaw think now if he saw them all decked out in Janet Russo's sultry hot-weather cottons? Four decades ago the author of Rich Man, Poor Man wrote a bittersweet short story called The Girls in Their Summer Dresses. Fashions have changed, but the women who don Russo's Summer of '81 frocks—which are close-cut and meant to be worn braless—would set Shaw's pulse racing.

At Henri Bendel in Manhattan, where Russo at 32 is the youngest designer with her own boutique, her bright solids and flower-garden prints are favorites with Marsha Mason (who buys them for her daughter, Nancy), Diana Ross and rocker Lucy Simon, Carly's big sister.

Russo, who also ships her dresses, blouses and skirts to Bonwit Teller, Neiman-Marcus and Bloomingdale's, expects to rack up $1 million in sales this year alone. "I don't make jodhpurs or knickers," Russo explains. "I design clothes that make women's bodies look pretty."

Russo was fashion-minded even as a child growing up in Bristol, R.I. Her parents had divorced when she was 2 and she lived with her mother. "I was a little rebellious," she remembers. "I always thought I was a beatnik. I wore black tights and ballet slippers." Russo spent one semester in 1968 at Garland Junior College in Boston, but she was kicked out of the school, she says, for "being bad in general."

By 1971 Russo had settled in Nantucket, where she borrowed $3,000 from her mother to open a tiny store on Federal Street; it has since moved to the town's cobblestoned Main Street. There she started making dresses—dyeing the fabrics in her bathtub and cutting the patterns on her bed. On sunny days she often closed the shop to go to the beach. She still maintains part ownership in the Nantucket store, but her free-and-easy summers have given way to 12-hour workdays in New York, where she now lives alone in a five-room co-op. "People always said they thought I would be successful," she says. "I was always very flattered—and I always believed them."