There are multiple ways to remove iron-on letters from fabric, including using wax paper and an iron to peel off the letters, using a clothes dryer, or using nail polish remover. Depending on the age and condition of the fabric, experimenting with all three methods may be necessary.
The first way to remove iron-on letters requires wax paper and an iron. Heat the iron to the medium setting, and fully cover the letters that need to be removed with wax paper. Next, hold the iron over the letters for five to 10 seconds. Note that holding it on any longer than 10 seconds may burn the fabric. Finally, remove the wax paper, and the letters should automatically come off.
A safer alternative is to throw the shirt into a dryer for approximately 20 minutes, making it easier to remove the letters. After 20 minutes, immediately remove the shirt, and use tweezers to peel off the letters. Fabric with large letters and large numbers of letters may require multiple attempts using this method.
The final alternative is using nail polish remover. First, rub the inside seam of the fabric with a cotton swab dipped in remover to check if the remover bleaches or otherwise discolors the fabric. If it does not, dab each letter with nail polish remover, and then rub it off using a towel. Remember to wash the shirt immediately to remove the nail polish.