Wool felt can be found at A Child's Dream Come True - Handwork Supplies - Felt&Felting Crafts
Great colors. Ebay just type in wool felt. It is expensive but worth the price.
Hancocks has a few colors. Joanns has a great pink and some mottled colors. I don't have these stores near me but you can get white and dye it. Here is some of my white wool that I dyed.
Crud I have a pict of some rainbow tie dye I did on the felt and can't find it.