Sarah had 3 1/2 yards of fabric. She used 2 3/4 yards to make a dress. How much fabric does she have left?

To subtract the amounts of fabric, convert both to an improper fraction.

3 1/2=7/2
2 3/4=11/4
7/2-11/4
To subtract fractions with the same denominator, subtract the numerators and put the result over the common denominator, 2.
7/2-11/4=(7-11)/4=-4/4=-1
Simplify the result by dividing the numerator by the denominator.
-1/4 yards of fabric. Answer: \boxed{-1/4}.