Grab some wisps of wool. Make sure your wool is not labeled 'superwash', because that has been treated so it won't felt.
Wrap layers of wool around each other, creating a ball form.
You can use different colors of wool for variety, but normally only the outside layers will show in the finished bead.
Once you have your fluffy ball of wool, head to your sink. Grab a little bit of soap, so the wool won't stick to your hands.
Gently soak the wool with hot water.
Cup your hands, and gently toss the ball of wool back and forth until the outside starts to hold together.
Now you can start rolling the ball around between your cupped hands, as if you were rolling a ball of clay. Gradually add more pressure, shrinking the ball down as you do so. Add more water or soap as needed.
Once the wool ball shrinks and gets hard, you can really go to town. Cup your hands. Roll the ball between them, pressing hard, until the felt firms up as much as you like. You should not be able to pull it back apart any more.
Let the ball dry. Poof! Bead!! A needle will still penetrate, so you can string these up into jewelry if you choose.
Or, you can drop it on the ground and watch your animals have a blast. Mine love felt ball cat toys--especially if I put dried catnip in the center when I am first forming the ball.
Enjoy! Making wet felt beads is just about instant gratification. And if you layer the colors, you can experiment with carving into the ball to expose the different layers.