Both. I think if she wore a skintight dress all over, it wouldn't seem as small. But since she is wearing the over-sized boxy top and skirt, her waist seems unnaturally skinny.
The left side looks like the dress (the white part) but the right side looks . . . off. Like it's the same color as her shadow on the wall and not the rest of the dress.
I don't think her waist is just the black part. I mean, there wouldn't be enough room for any internal organs!
ETA: ok, looking at it again I guess the black part is her waist only. I was thinking there were white cutouts on either side of the dress.