One of my passions is to create the felted purse. It can be as easy as finding a woolen second hand sweater and felting it in the washing machine then cutting and sewing the felted purse into any style you wish. You can add store bought handles or create your own.
as pictured here. I used a fairisle sweater and felted it in the washer, when dry I then created the bag.
This next felted purse was made by knitting a larger bag by hand and then felting it in the washing machine and blocking it into shape and drying.
Other felting techniques can be found on my web site http://www.thefeltedpurse.com
Where you can find videos and tutorials all about the different techniques of felting.