It just so happens I got these instructions last Tuesday at my guild meeting.
Two colour binding
Take your 1 5/8" strips & seam them together to make one long strip. Press in half lengthwise with right sides out.
Take your 1 1/8" strips & seam them together to make one long strip.
Take these two strips & sew them together matching the raw edges of the folded one to the raw edges of the other right sides together.
Sew the remaining raw edge of the narrower strip to your quilt and treat just like a regular binding mitering your corners.
You will fold the second colour toward the quilt enclosing the raw edges . This folded edge may be either hand or machine sewn. These directions produce 5/8" wide binding.
The girl who gave us these directions found that she liked it better when she used one strip 1 1/2" and the other one 1".
Michelle