To create the koala's head, cut a 1-inch-wide by 6-inch-long piece of wool batting with fabric scissors and wrap around 1/2-inch jingle bell.
Wrap a piece of wool roving around the batting and using a felting needle, secure wool in place. Continue adding roving and using felting needles to secure in place until ball is 3 inches in diameter. Create eye sockets by jabbing eye area with felting needle.
Insert threaded needle at top of head and run through ball to eye area. Loop thread through eye and attach securely in eye socket by running needle back through the ball to the top of the head. Repeat steps for the second eye. Tie off thread at top of head.
To make ears, cut two 2-inch-tall by 11/2-inch-wide D-shaped pieces of wool batting. Wrap each piece of batting in roving and, using felting needle, secure in place, shaping the ear as you felt. Attach ears to head with felting needle, using more roving to hide seams if desired.
Spread thin layer of gray wool over entire head and needle felt in place.
To make nose, place a 1-inch piece of black roving on the head, below the eyes, and shape and secure in place with felting needles.