Can I pray with towel which cover between knee and above stomach?

Praise be to Allah, the Lord of the Worlds; and may His blessings and peace be upon our Prophet Muhammad and upon all his Family and Companions.

The Awrah that should be concealed during prayer differs from the man to the woman. The Awrah of the man is the area between the navel and the knee while the Awrah of the woman is her whole body except the face and her hands.
So, if a man prays in a towel that covers from navel to knee then his prayer is valid although its reward is lesser than that of praying in a thobe or a similar garment as the latter covers the Awrah better. The evidence for this is the sound Hadith reported by Al-Bukhari and Muslim that the Prophet (Sallallahu Alaihi wa Sallam) said: "None of you should pray in one garment except if it is long enough so that a part of it can be put on his shoulder."
In addition, the praying person should put on his best and most beautiful clothes as Allah says: {O Children of Adam! Take your adornment (by wearing your clean clothes), while praying……} [7:31]
Ibn Abbas explained the adornment by the clothes.
On the other hand, if a woman prays in a towel only then her prayer is invalid according to the concensus of scholars because the Prophet (Sallallahu Alaihi wa Sallam) said: 'Allah does not accept the prayer of any pubescent woman who is not veiled."
Allah knows best