How to Remove Mildew Smell from Towels: Put your towels in the washing machine, using the hottest water available. Add one or two cups of white vinegar. Do not add detergent, fabric softener, or any other products at this time. Run the washer. Leave the towels in the washer and wash the same load again just as you would normally with laundry soap. Again, use the hottest water available. Don't use fabric softener or any other products. Dry the load in the dryer using a high heat setting.