Let the tree trunk or branch you'll use for this project dry completely to prevent splintering. To speed up the process, cut it into a few smaller sections. This may take months, but if you bring them inside to dry where it's warmer, it can dry faster.
When the wood is dry, use the table saw or handsaw to cut the wood into disks that are 1/4 - 1/2 inch thick.
Sand each disk with the coarse sandpaper first, then the fine.
Drill a hole through each - this is where the string will go.
Decorate your wood slice. I chose to use a wood burning pen on mine to create a design, but you can use paint or whatever else you like.
Add a coat of sealer to protect your ornament for years to come.