Consult your homeowner's association and acquire any necessary building or electrical permits before beginning work on your studio shed.
Clean out the shed. Remove all items and sweep it out from top to bottom, removing cobwebs and dirt. Inspect the shed closely for any carpentry or water damage that might require attention. Hire a professional to fix anything that can't be fixed with a little wood glue or simple carpentry.
Design your studio space. Plan where and how you want to install lighting and flooring, and what paint colors and furniture you want in the space. The size of your shed, your budget, personal taste and the type of studio you're creating will determine the interior design. For example, musicians might want to have certain walls or padding installed for better acoustics, whereas artists might require more windows for natural light.
Hire an electrician to wire the shed. Paint the walls and install the flooring.
Place your furniture in the studio. As shed spaces are small, keep furniture to the bare essentials needed for your craft. Add decorative touches such as paintings and candles that are reflective of your personal tastes to create a studio space that will make you feel at home.