The designers face the challenge of modernizing a look for a famous "fashion icon:" Cher, Farrah Fawcett, Pam Grier, Audrey Hepburn, Katharine Hepburn, Madonna, Marilyn Monroe, Jackie Onassis, Diana Ross, or Twiggy. They have $150 and two days to complete their designs.

The designers are informed that they'll be creating an evening outfit based on a story inspired by a tiny dog. The designers must also design outfits for the dogs to wear. They have $150 and two days to complete their looks.

The designers are tasked to create an "international jet-set" outfit. They will then be flown to Paris to model the wearability of the garments. They have $75 and one day to complete the look.

Fifteen designers arrive in New York and are asked to create an outfit in just two days using only materials found in their apartments.

The designers are paired into groups to design and create a gown for Miss USA, Tara Conner, to wear for the Miss Universe pageant. The designers have $300 and two days to complete their designs.

The designers, in teams of three, are asked to design a three-piece look that embraces the INC (International Concepts) brand. The winning design will be manufactured, produced, and sold at Macy's stores. The teams have $100 and two days to complete the challenge.

While in Paris, the designers' next challenge is to make a gown employing haute couture techniques. They have 300€ and two days to complete the challenge.

Eliminated designers who have won at least one previous challenge are given a chance to get back into the competition. The designers are asked to create a cocktail dress using only black and white fabrics. They have $100 and one day to complete their design, with the stipulation that they must use all of their purchased fabric.

The designers are asked to create an outfit that expresses "their specific point of view." They must also stage a photo-shoot with their models and find three words that best express who they are as designers. They have $250 and two days to complete the challenge.

Each of the remaining designers is given two months and $8000 to design a 12-piece collection for Olympus Fashion Week. In the interim, each gets a special visit in their hometown from Tim Gunn.

At the Waste Management Recycle America Center, each designer is given 30 minutes to fill as many bins as they desire with recyclable materials. They must create an outfit from these materials, in one day, with an additional $25 for art supplies.

The designers are asked to create an outfit for an "everyday woman" …each other's mothers and sisters. They have $150 and one day to complete the challenge.

In the conclusion of the finale, the remaining contestants ready their collections for the runway. Then they present their lines to industry insiders at Olympus Fashion Week.

The cast of Season 3 reunites to recap all the gripes, drama and other shenanigans which were only seen by those behind the scenes. One of the designers wins the first ever "Fan Favorite" award, along with a check for $10,000.