While not exactly a "baby," this hat was made for the three-year-old daughter of our program director. Make it smaller for babies or bigger for those grown-up kids. With kids, always make it a little bigger than needed--they grow quickly!
This one I whipped up in an evening from some scrap yarn (or what I thought was scrap yarn... turned out I needed it for another project). I added some cat ears, but I think it would also be super cute with bunny ears or in pink with a pig's tail. You can add faces with eyes, noses, and whiskers, too.
Yarn: Royal in Hueso (mc) and Nuez (cc) (Bone and Nut)
Needles: Size 6 DP or circular needles small enough for the project
CO 70 sts. Join in the round and work 6 1/2 inches in St st. Next row: *ssk, k2tog, k13 ssk, k2tog, k 14, repeat from * once more until the end of the row. Repeat decreases, until only a few stitches remain. Draw together and bind in all lose ends.
Front: PU 7 sts from each side. With mc, k1 row. Next row: p1 with mc, p5 in cc, p1 with mc. Next row: ssk, work 3 in cc, k2tog. Repeat until only 2sts remain in mc, k2tog.
Back: PU 7 sts directly behind ears. Work the same, but only using mc. When done, tie in all lose ends and stitch the front and back of the ears together.