From the Knitty archives, here’s a fun way to dye your own yarn with Kool-Aid (yes that’s right). Kool-Aid dyeing works only on animal fibers: wool, mohair, and alpaca. It doesn’t work on cotton or synthetics, though, so use pure wool yarn for best results. Link.
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Kool-Aid dyes are acid dyes and they do dye nylon fibers, which is why you never want kool-aid spilled on your carpet…