The Body Blankie is a wearable blanket that Greg received for Christmas. It only appears in the book Hard Luck, where Greg mentions re-finding it in his mom Susan's closet. It is covered with silhouettes of stars and crescent moons.
Prior to the events of Hard Luck, Greg Heffley received a Body Blankie as a gift for Christmas. Initially, he refused to wear it due to the stigma of "as seen on TV" products. He changed his mind after putting it on, however, stating that it felt like "being in bed all day". Greg also notes that Rodrick received one, but was so enthralled that he wouldn't take his off to let their mother wash it. This conflict reaches a climax when Greg and Rodrick sleep through a church service. As a result, they both lose their Body Blankies.
Role in Diary of a Wimpy Kid: Hard Luck
After Greg re-finds the item in his mother's closet, he decides to wear the Body Blankie to school. He immediately regrets this decision when he's forced to do Phys-Ed, comparing it to "being a penguin". After he is unable to write properly, or do Jumping Jacks in Phys-Ed, he attempts to take it off, only to discover the zipper had gotten stuck. He presumably is forced to cut himself out of it. Due to the Body Blankie, he drops his Magic 8 Ball during an exam. The teacher discovers it, and accuses him of cheating.