A diaper that fits a baby correctly should appear straight and equally proportioned on the babies body.
Also there should be no red marks around the babies waist or legs where the diaper wraps around and if so then the diaper is too tight and you should go up a diaper size.
The Tabs of the diaper should reach to about the center of the diaper landing zone without stretching too much and if you can barely get the tabs around the babies waist without stretching them too much then the diaper is too small.
When a diaper is fitting right around the waist and you can fit two fingers easily under the top waistband of the diaper then the diaper is snug enough but not too tight.