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If you try to cut a wool sweater, you'll end up with a pile of unraveled yarn. Unless, that is, you felt the sweater first. Felting knits the wool fibers together, shrinking the size of the sweater, so that when you cut it you'll end up with a soft fabric you can use in craft projects. Felted wool will not unravel and needs no finishing. The resulting fabric can be used to make a wide variety of woolen goods, from socks to hats.
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Wash a wool sweater in hot water with laundry detergent in a washing machine set to agitate normally. Once the cycle is done, check the sweater and determine if the fibers have begun to felt together. If not, wash a second time.
Dry the sweater in a clothes dryer set on high. The heat will further felt the fabric. The sweater will shrink considerably and become thicker and softer.
Cut the sweater as needed. One idea is to remove the sleeves and cut up the side seams to give you the front and back of the sweater as large pieces to work with.
Cut across both layers of the sweater under the arm holes to make a simple winter miniskirt. The bottom band of the sweater becomes the waistband of the skirt. Use the pieces of the felted wool to make slippers or mittens, or cut it into squares to sew into a warm scarf or a blanket.