A three-piece surgical drape with fluid diverting channel or sleeve therein and method of making or assembling the same. The drape generally including a first liquid impermeable section attached at either end thereof to second and third sections of the drape, respectively. At least a portion of one end of the first section of the drape folded back upon itself and intermittently tacked or bonded to the first section to create a channel or sleeve adapted to divert fluids. The channel or sleeve may also have a tube or hose placed therein to facilitate or enhance fluid diversion through the channel or fluid removal therefrom.