I found this pattern a few months ago. It was the first time I had ever tried making anything like it, and I was pleasantly surprised at how easy it was to do. I just finished another one last night:
This is for my sister's new granddaughter, Margaret Rose. I will include the purple hat that I made the other day to go with it:
I will also add a onesie for her to wear underneath it. The yarn I used is Caron Simply Soft; color is Baby Brights Ombre. This is fast becoming my new favorite yarn; it is reasonably priced (especially if you can find it at Wal-mart) and really lives up to its name, as it is very soft. It also comes in a wide range of colors. If you've never used it before, I urge you to try it... you'll like it!