U.S. Service Flags, Two Blue Stars, WWI, Commodore Stephen Decatur Family Collection.
This red and white wool flag is a service flag used to indicate family members who are serving in the US Armed Forces. This example is from the Lear-Storer-Decatur Families, used to indicate that two members were serving in the U.S. Navy during WWI.
Click here for more details ZFC3547 Full Version