I am knitting this flat, so I will sew it up later on, when I am done.

Yarn: Generic light worsted weight craft yarn.

Update: Please refer to my blog entry here on the meshy knitted hat

Old directions:
I think this would still work. But the shape will be a bit different.

1. Cast on 88 stitches with 4.5mm knitting needles.
2. 2x2 ribbing until you get an inch thick band.
3. Knit 1 row, transferring to the 6mm knitting needles.
4. Do the diagonal eyelet as mentioned here: http://www.knittingonthenet.com/stitches/diageyelet.htm
5. Knit until you get the desired depth of the beanie.
6. Sew the top together and seam too.