Felt is the oldest textile fabric. People figured out that making felt was very useful, felting came before spinning, weaving or knitting. Probably during the Bronze Age. When I visited Otzi in the museum in Bolzano Italy, they found felt among his clothing and Otzi is well over 4,000 years old. You know who Otzi is: the ice man found high in the Alps along the Italian/Austrian border. Because he was frozen he was perfectly preserved including the contents of his stomach. So they could tell what he ate, what he wore for clothing and what tools and accesories he had with him.
They say that sheep may have been the first animals to be domesticated after dogs. The sheep provided them with milk and as a by-products their skins and fiber for clothing. The early man figured out really fast that a wad of wool from the sheep was not only warm but it probably made a nice comfortable bed for sleeping. After a few nights of tossing and turning and sweating maybe even rain they found that the woold felted. Feltmaking and the use of felt is still a part of many cultures around the world.
Wool is hair and just like human hair, it has "cuticles" or overlapping scales, you've see dreadlocks well they are just felted hair. Wool pretty much acts the same it tangles and sticks together.
They say that wool fibers absorb eight times their weight in water. But it really depends on the wool, what animal it is from.