From the Knit Picks Website:
This classically styled scarf is soft and cuddly when felted. So easy to knit, you can finish one in every color for anyone on your gift list. Add a unique embellishment to make each scarf an individual masterpiece. Simply use any leftover natural fibers or your leftover yarn stash with the Needle Felting Tool and let your imagination and hands do the rest. Shown in Merino Style Storm.

Yarn:
Knit Picks Merino Style discontinued
(100% Merino Wool; 123 yards/50 grams):
Storm, 23464, 4 balls.

Needles:
Size 7: circular or straight
Adjust needle size if necessary to obtain correct gauge.

Notions:
Yarn needle
Top loader washing machine
Small amount of laundry detergent
Needle felting tools
Scrap yarn to create designs

Scarf is worked in stockinette stitch, then felted. Needle felting is done to add decoration in scrap yarn.

Needle Felting Tutorial is no longer available.