When you're ready to try a new knitting skill, such as cables, or lace, or short rows, or [insert new skill here], did you know that your choice of yarn can make it easier...or harder? Here are some factors to consider when you're ready to move beyond simple garter or Stockinette stitch:
Make sure you can see your stitches easily! Beautiful as they may be, this is not the time to choose a thick-and-thin yarn (above: a display at Gather Here, in Cambridge, MA), a really fuzzy yarn like mohair (below: photo from Ewe & Me Yarns)), or a highly variegated yarn (3rd photo, also at Gather Here).
The lace stitch patterns are similar, but the stitches are much easier to see in the yellow versus the dark purple yarn (and the lighting of the purple yarn is deceptive; under normal lighting, it appears more the color of the shadowed shoulder). This effect can be mitigated by knitting in bright light, but if you tend to knit in a fairly dim room while watching TV, stay away from midnight blue yarn for your first lace project!
Make sure your yarn is easy to work with! Again, the mohair yarn is a poor choice for your first cabled project, because the fine fibers that create that lovely haloed effect will tend to get caught in your needles-- and will also make life miserable if you need to rip out any mistakes.
What about that slippery silk yarn you fell in love with (above photo: Bergere de France Soie)? Sorry, but often that gorgeous sheen means the yarn is quite slippery, and not only will the stitches fall out immediately if you happen to drop one off your needle, but I've worked with some silk or bamboo yarns that are difficult to even wind into a ball without sliding into a tangled heap. Note that you should avoid slippery yarns, not all silk or bamboo yarns; some are textured, or blended with other fibers, and are very easy to work with.
Some yarns are also difficult to work with because they split easily. This becomes especially problematic if you are working cables or lace, because the stitches are pressed together on the needle while working a cable cross or while working several stitches together, increasing the chance that you will split a strand of yarn with your needle. Generally a tightly twisted yarn is less likely to split than a loosely twisted one; in the above photo, the twist in the yarns increases from left to right.
And finally, a word about very fine yarns (#0 lace or #1 super fine weight): Don't do it! Not for your first project using an intermediate knitting technique, anyway. These yarns not only violate principles #1 (it's relatively hard to see your stitches) and #2 (it's physically more difficult to manipulate such fine yarns, especially if the needles are very small), but using such lightweight yarns will make your knitting go VERY slowly, which can be frustrating and discouraging.
Next post: Next Level Knitting: Choosing a yarn that helps, not hinders