Rug making is an ancient craft, and covers a variety of techniques.
Braided rug

Braided rug

The braided rug was a staple in early, Colonial American culture. Settlers used scraps of clothing and other excess materials to make a floor covering that would provide warmth and protection for a particular home's inhabitants and guests....

s are made by using three or more strips of fabric, usually wool, folding the raw edges to the middle and braiding them together. For an oval rug the center braid should be one inch longer than the width-length in feet. example 2' x 4' rug center strip would be 2'2" long. The center braid is laced together and new strips are sewn on to make the braid longer as lacing continues.
Traditional rug hooking is a craft in which rugs are made by pulling loops of yarn

Yarn

Yarn is a long continuous length of interlocked fibres, suitable for use in the production of textiles, sewing, crocheting, knitting, weaving, embroidery and ropemaking. Thread is a type of yarn intended for sewing by hand or machine. Modern manufactured sewing threads may be finished with wax or...

 or fabric

Textile

A textile or cloth is a flexible woven material consisting of a network of natural or artificial fibres often referred to as thread or yarn. Yarn is produced by spinning raw fibres of wool, flax, cotton, or other material to produce long strands...

 through a stiff woven base such as burlap

Burlap

Hessian , or burlap in the US, is a woven fabric usually made from skin of the jute plant or sisal fibres, or may be combined with other vegetable fibres to make rope, nets, and similar products...

, linen

Linen

Linen is a textile made from the fibers of the flax plant, Linum usitatissimum. Linen is labor-intensive to manufacture, but when it is made into garments, it is valued for its exceptional coolness and freshness in hot weather....

, rug warp or monks cloth.