Rinse chilies and cut off stem ends. Wearing gloves or holding chilies with a fork, cut chilies in half lengthwise. Slice out and discard veins and seeds. Cut chilies into 1/8" to 1/6" slivers. Do not touch chilies with bare hands.
Put chilies, vinegar, and sugar in a 4-5 quart pan. Bring to a boil over high heat, stirring often, and boil until mixture is reduced to about 1/3 cup, about 7 minutes.
Scrape jelly from jars into pan. Stirring often, boil until jelly melts. Ladle hot jelly back into the unwashed jars to within 1/4" of rims. Wipe rims clean and screw lids onto jars. If there is a little extra jelly, pour into a small dish and cover when cool.
After 1-1/2 hours, gently shake jelly in jars to resdistribute chili pieces if they have floated to the top. When jelly is cool, use or store in the refrigerator up to 3 months.
Decorate jar tops with colorful paper or fabric and tie with raffia or ribbon for gift giving.