I am wanting to make a space cake similar to this one:

http://blog.pinkcakebox.com/rocketship-birthday-cake-2009-08-01.htm

We wanted to do buttercream on the outside instead of fondant. Is there any way to get the swirl/tie-dye effect with smooth buttercream? I know I could make light navy blue icing and then add a little more blue to make it swirled, but I'm afraid once I put it on the cake and smooth it out it will just look like horizontal lines around the cake.

Any ideas?

You could do that with an airbrush.

hm. No airbrush here...

Any other ideas?

Maybe just when frosting the cake, sloppy frost with your main color and add (read: glob on) the other colors (different shades of blues and purples) then take your bench scrapper or frosting spatula (whatever you use to smooth) and smooth around the cake while its on a turntable....if you dont have an airbrush.

I wonder if the same technique that I've seen mentioned on here for making cammo cakes would work? Try doing a search for that!

I did a tie-dye cake once with buttercream years ago. I used regular Wilton gel colors and painted them onto white buttercream. It looked like real tie-dye but did not have the perfectly smooth sides. ?? It was way before I had a digital camera and I'm not sure where the picture is but I remember it resembling a Van Gogh type painting if that makes any sense?