A treatment process used for cotton and other natural as well as chemical fabrics that was invented by Sanford L. Cluett in the late 1920s and patented in 1930. Sanforization stretches, shrinks and fixes the woven cloth in both length and width, before cutting and sewing to reduce the shrinkage which would otherwise occur after washing.
The process was first used by Erwin Mills, but soon other companies followed suit. You will often see it advertised on vintage clothing with tags stating that the fabric is sanforized or sanfor-treated.
Many denim manufacturers started using sanforized denim which has the overall shrinkage of the fabric is reduced to about 3%. This meant that customers didn’t have to take shrinking into consideration when they bought their jeans.
Levi’s, however, remained true to the shrink-to-fit denim until the 1970s – they actually still have a shrink-fo-fit 501 in their American red tab line, and the dry Levi’s Vintage Clothing 501 jeans are shrink-to-fit as well. Many Japanese heritage denim brands also offer shrink-to-fit jeans, still today most denim manufactorers only use sanforized denim.
Source: After the Denim