Most animal fibers that are not treated to be machine washable will felt. Although wool, mohair and alpaca will all felt, the end results will be different in each. When wool felts it becomes thick and durable, alpaca retains some of it’s softness and does not get as stiff as wool, and mohair tends to be very fuzzy.
The process that the fibers go through to become felted, is the same for all of these fibers. By applying heat and agitation, the scales that make up each tiny strand in the yarn open up and catch upon one another. The more that these fibers rub up against each other, the more tangled they become. Once cooled and dried, the fibers are forever locked together to form a matted form of wool known as felt.
We have some information on how to felt by hand; and Knitty has a great artical on machine felting.