Fabric patch, c. 1965
Embroidered fabric patches were made and sold in Hawaii starting in the 1930s, although they were used far earlier than that for military uniforms.
Souvenir patches like this one were meant to be sewn onto a shirt pocket, usually, up into the 1960s. Hippies changed the style by attaching these all over denim jackets, or on jeans, into the 1970s. This particular patch dates from the surfing fad of the ‘60s.
Surfing was just one the many subjects that appeared on patches from Hawaii.