Muslin is a cotton fabric constructed with an open, loose weave. That airy structure makes the material breathable and quick drying, and it is also why the fabric grows softer with every wash. Loose weaves like this can shrink a bit the first couple of times they get wet while the fibers relax and settle. This slight shift is a normal part of how the cloth behaves, not a flaw.
Our garments use double layer muslin cotton, and we pre-wash every piece before it ships so it arrives soft with most of the shrinking already finished by the time it reaches you. To keep the fit consistent, wash cold on a gentle cycle and either tumble dry on low or hang it to dry. Skip fabric softener and skip high heat, as both are harder on the fibers and work against the fabric over time.
You will likely notice some creasing after washing, which is normal for muslin and part of its character rather than a sign anything went wrong. The seams are flat and sewn to hold up through regular laundering, and the dyes are chosen to be safe for kids' clothing without needing harsh finishes. If you follow a cold wash and low heat routine, you shouldn't see noticeable shrinkage wash after wash.