There are at least three different styles of dressing for dressing as a ninja. There is the traditional way, the ordinary way, then the noticeable but unbelievable way.

Traditional Way

This way consists of the hood, the soft cloth shoes, loose cloth pants. This way is universally recognised as the way th ninja dresses, so is not one of the better ways to dress unless you want to be flashy as a distraction. Just be sure that, if you're a distraction, that you can distract (stay successfully away from the enemy).

We tried to get a picture of a ninja in traditional garb, but
he immediately disguised himself as a cat and a tree.

The Ordinary Way

This way consist of wearing ordinary clothes that aren't particularly noteworthy. This style should ussually consist of clothes you can move in easily without getting caught up. This way is one of the better ways, in my perspective, for you can get around with out being suspected of being up to "no good."

The skilled ninja eye will immediately recognize that the ninja
in this picture has disguised himself as a striped shirt on
the back of his victim.

The Noticeable but Unbelievable Way

This way is particularly good if you want to get through a lightly crouded area in the enemies territory. This style consists of the wildest clothes (that you can easily move in) that you can conceive of. For instance, consider if you were to wear your pink and green polka dot pants, orange sneakers, rainbow-striped shirt, and plaid hat. If an enemy were to see you, but not be able to catch you, what would he tell his superior? That his saw a ninja in polka dots, plaid, and stripes? His superior would either laugh at him or turn him in for being on drugs. Which, if you think about it, is better than you stabbing him to death.

This ninja is not a drug induced, photoshopped, or mentally
challenged person's picture. This is a legit, real ninja.
She mistook us for a guard, so she happily posed for a picture.