I started knitting for preemies simply because I had one, and I didn't know a lot about what people would knit to donate to NICUs; I just made what I wanted my baby to have.
Since then I had a good chat with About.com's Guide to Preemies, Cheryl Morrissette, and she provided me with some great tips for knitting items to donate to preemies.
She noted that the most useful items for little ones are hats, blankets and booties, and that, of course, projects should be soft, washable and hypoallergenic. She said the hospital where she works often receives items that are too small, so as usual it's worth it to check the guidelines of any organization you might be knitting for or ask the hospital you want to donate to what its needs are before you start knitting.
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