Pixxo 3D shows how to make an easy felt material with Blender using particles.
There are plenty of ways to get a nice-looking fabric or felt material in 3D. Some are easier than others. In this tutorial, Pixxo 3D Juandre (Jay) Labuschagne shows his go-to method for creating a quick and straightforward felt material in Blender that uses the principled shader and particles to get that escaping fiber look to the render.
More on Creating Fabric Materials in Blender.
Richard Shilling (Dikko!) recently dove into procedural shading in Blender, offering insights into creating a velvet material.
In a similar tutorial from CGMatter, you can see how to turn any object (within reason) into a woven basket.