colorlessblue: Slippery, not only when wet.

There are some facts about alpaca yarn that help you plan better your work and avoid a great deal of frustation, if you know those beforehand. The most important one is that alpaca fiber is slippery. But starting from the start.

The yarn is made of fibers, right? Alpaca fibers have some different characteristics when compared to wool. They are in general longer than sheep wool fibers., with a diameter that varies from around 18 microns to 25.5 microns, if you consider most commercial yarns available to the hand knitter. The finest yarns are classified as Royal Baby, or Royal Alpaca, and are under 18 microns. Baby Alpaca means the fiber diameter goes from 19 to 22 microns (about the same as the finest merino wool), and Superfine stays between 23 to 25.5 microns. The alpaca I've used was 25 microns.

Alpaca yarn absorbs moisture as well as wool, while staying warm and dry. It doesn't contain lanolin, thus causing less allergies. It's also several times warmer than wool, because the fibers have a hollow core. See this baby:

Holey and lacy and light as it is, it keeps me as warm in the movies theater as my denim jackets (plus I don't need to get out in the middle of the movie to pee).

The most important difference between alpaca and wool, though, is the scales on the fiber surface. Alpaca has less scales, larger than wool. That makes the fibers lustrous, slippery, makes it take more time to felt, slippery, more resistant to bleaching, slippery, inelastic, and slippery. So, what needs to be remembered is that alpaca is:

Warm - using lighweight yarns and open stitches gives warm and comfortable projects. thicker yarns are better for clothes to wear outdoors in winter. Color work is better in intarsia, because stranded knitting creates a double layer that can get just too warm and heavy for comfort.
Inelastic - if you knit tight, your yarn won't stretch much when you insert the needle to help you with the most tight stitches, like k4tog, or the occasional p7tog (nupps, anyone?) Also, the yarn won't accomodate irregularities the way wool does, so those will be very visible on plain stockinette. And if you make a tight garment, it will stretch to accomodate your body, but it won't come back to the original shape afterwards. Ribbing needs to be done extra tight. Twisted stitches help. Not ribbed edgings are even better.
Slippery - it's not that the stitches will fall from the needles and run down the WIP (Although they might. Wooden needles FTW). It's that the fibers that make the yarn will slip past each other and make the yarn grow. Put lots and lots of cables and the weight of the sweater will give you a dress. Forget knitting a sizable swatch, washing the swatch, hanging the swatch to dry, using something to weight down the swatch and then, after the swatch grew, counting accurately your row gauge before starting your project, and you'll have sleeves of doom. Garments with seams, reinforced shoulder seams or knit sideways are good ideas, and if you knit top-down it's easier to shorten if needed too. Or you can use alpaca to knit things where the potential growth isn't a problem. Afghans are good and warm and cuddly. My lace shawls? I like the big, babeh.

The last thing to remember is to take extra care when weaving in the ends, so that they won't slip out of the fabric. When I made the Wisp, I first used buttons, before deciding that the buttons were too heavy for the yarn and would weight down the fabric and stretch it and deform it completely and make my FO ugly forever, but by the time I decided I wanted to remove the buttons the pieces of yarn I used to attach them had already slipped from the special knots I learned with the sailors and the buttons just fell down. Right now I'm eyeing the tube of superglue, but I'm just paranoid.

I used several sites I found on Google as information sources but these 2 sources have really lots of info and tips on how to best use alpaca yarns: