Physically the wool fiber is a complex arrangement of cells. An inner or medullary layer, containing the natural pigment, may or may not be present; in highest bred, pure white wool they are lacking. The cortical layer gives the fiber its strength and also absorbs dyestuffs, while the outside layer of horny scales, generally overlapping each other and projecting out from the surface of the fiber to a greater or less extent, gives it that characteristic peculiar to wool, the property which the fibers have of felting together, so that cloth may be made without spinning or weaving. These serrations produced on the surface of the fiber hook into each other, especially when the fiber is warm and moist and the scales open more; then when dry again they hold fast together. To this property the shrinking of wool is also due.

The difference between hair and wool is largely in this layer of horny scales. On hair they are much less marked, and often do not project at all at the edges. The internal structure of the two varies so in different varieties of each that it is hard to make a distinction; in fact, some wools are so similar to hairs that it is difficult to distinguish between the two.

Between hair and wool are a number of fibers varying in the number of scales and the amount of projection. Among these are alpaca, llama, camel, and others already mentioned. The distinction is sometimes made that hair is straight and wool is curly, or that hair is stiffer than wool; but here again the difference is sometimes greater between the extremes of wool or the extremes of hairs than between a given wool and a given hair.

The microscopic structure of the wool fiber serves to distinguish it from all other textile fibers, as well as to distinguish the different kinds of wool from each other.

The amount of luster which wool has also depends on the scales. If the edges of the scales are rough and uneven, the fiber as a whole will not be as smooth and lustrous as a fiber in which the scales are more regular and reflect the light evenly. The fiber from the Angora goat, which has less prominent scales, has greater luster than the wool from most sheep, but there is also great variation in different breeds of sheep.

In certain classes of sheep, or on fleeces which have had very hard wear, fibers often lack part of this surface layer of cells, are irregular in size or even may be bent at an angle, lack strength, and are therefore not as valuable as the perfect fibers. They lack luster usually, cause trouble in manufacture, and do not always take dye, and so make a streak in the finished cloth. These fibers are called kemps.

In tensile strength and elasticity wool fibers vary greatly. The structure of the fiber makes it elastic and also gives it strength. The kinky nature of the wool also makes it elastic. In its hygroscopic property, or power to absorb water, wool stands first among fibers, being able to absorb within itself as much as fifty per cent of water without appearing wet, although the average amount of moisture absorbed is twelve to fourteen per cent. In European and English markets sixteen to nineteen per cent of water is usually allowed in wool. This percentage varies with the form of the wool, whether loose, combed, yarns, etc. The price is regulated according to the percentage of water. So important is this percentage of water to the buyer that there are conditioning houses whose business it is to determine the amount of water in samples of wool.