For the most part male Egyptians likely wore kilts based on how they display themselves in tombs. However, females were often seen wearing dresses, and there is evidence of Egyptian statesmen on the plump side wearing clothing on their upper body. So it wasn't likely every single person was shirtless but it was probably a common sight.
Sources: Studying Egyptology, Women in Ancient Egypt by Gay Robins, Encyclopedia of Ancient Egypt by Helen Strudwick.