A variegated yarn is a yarn that is not dyed in one solid colour. The colour variation may be extremely subtle, with slightly different shades of the base colour appearing throughout the skein. It may also involve a blend of completely different contrasting colours.

There are a few different types of variegated yarn:

  • some yarns are dyed to create a more random colour pattern as the crafted object progresses. This is sometimes referred to as a "zig zag" colour pattern;
  • self-striping¬†yarns are dyed different colours at specific intervals so that they will produce even stripes as the crafter knits or crochets with them;
  • fair isle¬†yarns are dyed in a way that will produce a predetermined pattern using different colours, simulating fair isle knitting without the need for multiple yarns.

When wound into a skein, variegated yarn will often not be indicative of how it will turn out when used. Self-striping and fair isle yarn will probably be identified as such on the label. If you come across a variegated skein that you really, really like, I'd advise looking for an example of a finished product made with it. You can search for projects by colourway on Ravelry, or your local yarn store may have swatches or samples of items made with that yarn. I've also read that some stores will let you knit a small swatch of a yarn you're interested in buying but don't want to commit to until you've seen how it looks.

I've more than once seen variegated yarns that look great when wound into a skein or hank, only to look up finished products and discover that I don't like how it looks when knitted.

Most major yarn brands produce some form of variegated yarn, from subtle to dramatic.