Fiqh-us-Sunnah Volume 1, Purification and Prayer, Fiqh 1.113A.

It is preferred for a person to wear at least two garments, but he can wear just one if that is all he has. Ibn ‘Umar reported that the Prophet, upon whom be peace, said, “If one of you is going to pray, he should wear two garments, for Allah has the most right that you should look good for Him. If one does not have two garments, he should cover himself with a cloak when he prays, but not like the Jews do.” (Related by at-Tabarani and al-Baihaqi.)

‘Abdurazaq related that Ubayy ibn Ka’b and ‘Abdullah ibn Mas’ud had an argument. Ubayy thought it was permissible to pray in one garment, while Ibn Mas’ud said that that was allowed only if one had no other clothes. ‘Umar mounted the pulpit and said, “The correct position is: If Allah gives you more provisions, you should wear more clothes. A man can gather his clothes about him, or pray in a waist cloth and a cloak, or in a waist cloth and a shirt, or in a waist cloth and a caftan, or in trousers and a cloak, or in trousers and a shirt, or in trousers and a caftan, or in leather trousers and a caftan, or in leather trousers and a shirt.’ And I (a narrator) think he said, ‘Leather trousers and a cloak.”

Buraida reported that the Prophet forbade one to pray using an improperly-affixed sheet to cover his ‘aurah, and to pray in trousers while not wearing a cloak. (Related by Abu Dawud and al-Baihaqi.) It is related that when al-Hassan ibn ‘Ali prayed, he would wear his best clothes. He was asked about that and he said, “Verily, Allah is beautiful and He loves beauty, so I beautify myself for my Lord.” Such a view is in accord with Allah’s words, “And wear your adornment for every prayer.”