Laundry soap is very easy to make at home. It is very cheap and is more environmentally friendly then commercial laundry soap. As a bonus it also works just as well.

Commercial laundry detergent has many negative effects on the environment. Of course, one wash is not harmful but it is the build up of the ingredients that is slowly (and sometimes not so slowly) damaging the flora and fauna (plant & animal life) of our waterways. The US's environmental protection agency has a fact sheet on the different effects of the common ingredients of laundry detergent.

Out of fairness and intellectual honesty, I've found some information on the environmental effects of ingredients used in homemade laundry soap. While the ingredients are not completely innocuous they appear to be much less harmful than the ingredients of commercial laundry detergent.

Borax is used as pesticide. It is toxic to animals and humans but degrades into boron in the environment. Boron is an essential plant nutrient. Soil that is low in boron can be supplemented with borax. Borax is a reasonably safe ingredient in terms of how it affects our environment. I found a unbiased fact sheet on it here.

Washing soda, also known as soda ash, is very innocuous. It's chemical known as Sodium Carbonate. It's even used as a preservative in some foods. In the environment it main risk is found in the fact that it is a strong base and so consequently it can affect the pH of the waterways if sufficient buffers are not in place. Normally, water is treated and the pH is appropriately adjusted and so this is not a concern. My source can be found here.

Ivory bar soap is almost completely soap which is biodegradable. According to Ivory's website even the small percentage of the bar that is not soap is also biodegradable.

Homemade laundry soap is cheaper then commercial laundry detergent. I calculated it to be about 2 cents per load while the cheapest commercial detergent was about 8 cents per load. That can add up, especially if you buy more expensive detergent because the cheap stuff doesn't work.

There are all sorts of versions of this recipe on the internet. This is what I do and I've liked it.

1/2 cup borax
1 cup washing soda
1 bar of ivory soap
10 cups very hot water

Grate the soap into a pot and cover with several cups of water and cover. Dissolve the soap completely and then add the borax and washing soda. Keep the temperature at medium until it is all dissolved. Pour it into a bucket and add the rest of the water. Stir it regularly while it cools. It should gel up although, occasionally for some mysterious reason this doesn't happen and instead you get a caked layer on the top. If this happens mash it up with a potato masher before using. It will work just as well it's just not as satisfying. Use 1 cup per wash load. Doing a quick google search (try: homemade laundry soap recipe) will provide you with other similar recipes and advice.