There are many uses for pegboard in just about every room of the house. Here's how to set one up.

Tools and Materials
Pegboard
Pine 1-by-2s
Wood screws
Plastic anchors (optional)
Screw gun or drill
3/4-inch wood screws and washers
Paint
Hooks and holders

Pegboard How-To
1. Pegboard is available in 2-by-4-foot, 4-by-8-foot, and 4-by-4-foot pieces. Buy as much as you need, cutting it, if necessary, to size. With pine 1-by-2s, build a perimeter frame of identical dimensions. Mount the frame by screwing it into the wall. (If you are mounting the frame on drywall, you will need to use plastic anchors in conjunction with screws.)
2. Using a screw gun, 3/4-inch wood screws, and appropriately sized washers, mount the pegboard on frame, aligning outer edges and spacing the screws at equal intervals. (If you do not have a screw gun, drill a pilot hole first, then insert the screws with a screwdriver.)
3. Paint the pegboard in a color to match the rest of the room, and add hooks and holders for hanging tools.