Because this is an art form, it's up to you to decide when your project has had enough needle felting. I really like the plain and simple (but not as boring as before) look of my felted swatch with just a couple of plaid-like stripes, but such a blank canvas could easily take more embellishment if you're into such things.
Once you start needle felting embellishment on a project it can be difficult to stop. You'll be tempted to add a few basic shapes, stripes, polka dots and cut-out shapes (hopefully not all on the same project) just because you can.
Once you decide you're finished, though, you'll need to do a bit of cleanup work. Trim any fiber that runs over the edge of your piece, and go back over those edges to make sure they're firmly fused to the background fabric.
You may have other errant strands that didn't quite felt as well as the others that you can either go back over or trim away from the work as well. The final phase is all about making the work look crisp and, well, finished.
And once you've started needle felting it's likely you'll want to find all sorts of ways to use this technique. Have fun and let your imagination run wild.