How do we determine what “Made in America” means? According to the Federal Trade Commission (FTC), “Made in America” means all, or virtually all, of the product was made in the United States. All significant processing, parts, and labor that go into the product must have originated in the U.S. The product must have negligible foreign content.
For clothing, the labeling requirements are a bit different. Textiles are permitted to have a “Made in the USA” label as long as the fabric was made in the U.S. and the garment was cut and sewn in the U.S., regardless of where the fiber that made up that fabric was grown or where the yarn was spun.
Keep in mind there are also derivatives of the “Made in America” label that sound like they're the same thing but are not. “Made in the USA of U.S. and Imported Parts” for instance means that the item may have been assembled in the U.S. but does not contain all U.S. made components. Some labels will specify a percentage of U.S. made content.
Another popular option is “Assembled in the USA." This label may insinuate all components were made elsewhere, but the item was put together in the U.S. For these designations, the FTC sets standards for these labels. Manufacturers who imply there is more U.S. content or involvement in the product will incur sanctions.
Source: Kristine Shreve