Sometimes these two terms get mixed up and can get confusing. So in a nutshell; felting is when wool fibres are joined together using soap, water and friction (wet felting) or barbed needles stabbed repeatedly into the fibres (dry felting or needle felting). Fulling, is when wool is spun into a thread or yarn, then knit or woven into a cloth- that is then shrunk. Sometime this shrinking process is on purpose and results in a strong, thicker, more water/wind resistant fabric- think of a “boiled wool” coat. Sometimes the shrinking is by accident and results in a lovely wool garment that is stiff and no longer fits the original owner. (insert curses here)
Fulling can also be performed on hand spun wool using a process of plunging it in hot water and then cold. This can result in a yarn that “blooms”; turns fluffy and cloudlike, but not felted which would be compacted and “hard”. This yarn would then be used for knitting or weaving.
There are patterns available for knitting all kinds of objects and then fulling them. For example; knitting very large mittens in 100% wool and then fulling them so they shrink and stiffen and become very warm and water resistant. The yoga bag in the photo was knitted then fulled so it shrank to the correct size and has a muted, fuzzy, blended look to it and will handle the wear and tear of holding a yoga mat. If you plan to knit and then full an item your wool must not say superwash. Superwash is a chemical process that prevents wool from fulling- for example if you want to knit socks that can’t be shrunk in the washing machine- use superwash wool.
So, fulling can be on purpose and end up with a lovely intended result. Accidental fulling of your souvenir hand knit socks from Scotland- not so much.