If you can make a yarn-over (YO) and knit 2 stitches together (K2tog), you can knit lace.
In fact, you can knit this lace scarf in a weekend while watching TV or listening to an audiobook, once you get into the pattern. The pattern stitch is an old Shetland pattern often called Feather and Fan, but sometimes called Old Shale, although Elizabeth Lovick writes they are different pattern stitches here, and that "shale" is Shetland pronunciation for "shell." A neat thing about it is that it forms its own scalloped border at cast-on and bound-off edges, so all you have to do is knit the thing. Four rows make up the pattern, and it can be modified to suit your taste for more or fewer scallops, or to make a stole or blanket, or to use any weight yarn you have in your stash. For learning this pattern and making the scarf, you'll need about 350 yards of fingering weight yarn (sample shown is a 75% wool/25% nylon blend from Southern Girl Knits and size 7 needles. Gauge is not terribly important; mine was 5 stitches and 8 rows (4 ridges) to the inch in garter stitch (I didn't want the ends to curl), unblocked.
Two important things to know:
1) You must cast on loosely so the edge will scallop. I used a long-tail cast-on, and casted on over 2 needles. Use whatever cast on method you like, but make it loose.
2) You'll be binding off loosely as well, so I advise using the bind off method in the instructions. It'll help the bound off edge to scallop nicely.
You'll see, the scarf will have a pretty scallop at each end even before blocking. The top photo in fact is of the cast on edge before blocking.
Feather and Fan Pattern Scarf
Cast on 52 stitches loosely. Knit 2 rows.
Begin Feather and Fan:
Row 1 (wrong side): K2; *K2tog 4 times, YO P1 8, K2tog 4 times,* repeat between *'s; K2.
Row 2 (right side): K across.
Row 3: K2, P to last 2 sts, K2.
Row 4: K across.
Cont in Feather and Fan stitch until scarf measures 44" or desired length from beginning (blocking it will stretch it about 25% percent in length). End row 4. K 2 rows and bind off loosely as follows: K2, then stick left needle into fronts of 2 sts just knitted and K2 tog through back loop; K1, then stick left needle into fronts of 2 sts on R needle and K2 tog through back loop. Continue to BO sts in manner described until all stitches have been bound off. Block, pinning out scallops. Weave in ends.
That's it. You have now knitted a lace scarf. Congratulations and wear it well!
(PS: There's a link to the pdf version of this pattern on the side bar at left).