Into something much more useful, like this:

Felting also creates a more sturdy fabric, making it perfect for things like slippers. (Kindly ignore the leaf pieces on the slippers, I wore them outside a couple times while chasing after the dog in the backyard)
Felting is a process that can be done with most animal fibers, like wool. The secret is that the shaft of the animal fibers are covered with little scales. When exposed to heat, these scales tend to start to stick out. Fiction with make the scales from several fibers start to stick together, eventually forming a felted material.
In addition to the shrinking wool sweater, another commonly experienced example of this would be the matted hair that you sometimes find on animals, or matted human hair, for that matter. It is all the same concept.
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Slipper Pieces Pre-felting |
Despite these things, the actual process of felting is not difficult. You start by creating your knitting. It usually looks pretty loose, big, and floppy. At best, pre-felted pieces bear a distant resemblance to the desired finished product, and the fact that felting shrinks the pieces more lengthwise than width wise often creates an awkward looking project.

Then, you take your precious knitting and load it into a pillowcase (I use a zippered one). Close up the top.

Prepare your washing machine for felting. You want to set the water temperature to hot, select the lowest possible water level and add some materials to create friction, some people use tennis balls, some use jeans, I usually use towels. Add a small amount of detergent, and start the machine. Take a deep breath and toss the knitting into the machine.
Once the machine starts to agitate, check on the progress frequently. I usually check somewhere between five and ten minutes. Checking this often gets annoying, but it you shrink your item too far, it cannot be undone.
Don't let the machine go into the spin cycle, you'll end up with creases in your project. Depending on how long the process is taking, you might need to restart the agitation cycle.

Enjoy the finished result and smirk because you've learned another knitting technique.