No name is more synonymous with stagecraft, acting and theatre than William Shakespeare. Plays such as the famous "MacBeth," "Romeo and Juliet," and "Othello" are just a few examples of the timeless stories that "the Bard" brought to life in the London of Elizabeth I. Given his associations with theatre and acting, along with the almost mythical quality of his influence on the English language and literatures, it seems natural to want to portray Shakespeare in costume. The key to the proper portrayal lies in putting together a good costume.
William Shakespeare lived from 1564 to 1616. For those who want to costume the classic version of Shakespeare, it's very important to get the style of the period right. Wearing a tunic of fine cloth (or at least fine-looking cloth) is necessary, and the tunic should have puffed sleeves. There should be a leather belt to cinch at the waist, and the tunic should be worn with a pair of tan or black hose that reach the knee. A pair of high socks should meet the hose at the knee. You should be wearing a cap with a feather in it, and you should also have a pair of appropriate shoes--they should look something like loafers, which could be modified to fit the period. Lastly, a high, stiff collar, preferably made of lace, is very important to pulling together the image. To top it all off, add some accessories like a quill pen and a scroll of parchment.
While the original, 16th century Shakespeare is probably the most recognisable, there are other, less complicated versions that can be put together. A "formal" Shakespeare can be put together with a three piece suit, and the proper accessories. The idea with this type of costume is to have a more modern look, but to bring across the same creativity and force of the character. To try and bring this across, it may be necessary to have Shakespeare's famous pointed goatee, and to carry a pen and pad to write on. Since the costume itself won't bring across the character as well, you'll have to practice mannerisms and behaviour that will do it. Speak with an older, British accent and, if you can manage it, in iambic pantameter.
If you'd rather get more creative with your portrayal of Shakespeare, don't let convention hold you back. For instance, if you wanted to make a Shakespeare costume that was done in the black pyjamas of a theatre class, or with a turtle neck and sunglasses to make him a Beatnik, then go right ahead. You could even do a punk rock Shakespeare, with a "Romeo and Juliet Live" T-shirt and a leather vest. Regardless, whenever you make a modern interpretation, make sure that you put cues into it so that people will guess who you are. The above patterns of speech and referring to people using formal titles such as lord and lady are good cues. If you have a working knowledge of Shakespearean works, engage in conversation about some of his plays while in costume, and make sure to refer to them as "your" work.