Since apparently, some folks aren't getting it.
This is aimed (mostly) at knitting professionals. You know, the people you expect to KNOW STUFF. Say, producers of international magazines and publishers of lots of knitting books. The rest of you, well, I hope you find it interesting and educational, but since it's your hobby and not your JOB to know this stuff, well, it's your hobby, so enjoy.
First, COLOR KNITTING.
There are a bunch of different types of color knitting, but for now we're going to cover the two major types so I'm not here all freaking day (and neither are you). The two main types (not counting stripes or using types of variegated yarns, or slipped stitches, or...) are intarsia and stranded.
INTARSIA means "to insert" as in puzzle pieces, in Arabic. (I think Arabic.) The knitting term is swiped from a woodworking technique of the same name, in which pictures are made with little bits of different colored woods put together. That's basically what it is in knitting, but with fiber instead of wood. You knit little blobs of knitting, and twist the yarns together where the colors meet, to hold the little bits together. Generally, if a blob of color is more than an inch across, it's done with intarsia, because that's what it's best suited for. It gives you big blocks of color, like this:
Long Leaf Coat". For technique how-to, you can cruise over to Knitting Help to learn or jog your memory.
Then, there is STRANDED COLOR. It is just like it sounds like. You use two (or more) colors, and carry them along in strands across the back of the knitting, using whichever color you want to or feel like or the pattern says to do it. This is, historically, a popular method, because with all those strands running behind the main fabric, the thickness of the fabric doubles, at least. Which makes it much warmer. Because of all the strands running along behind, most folks don't knit with one color for more than an inch at a time, and usually try to stick with only two colors, for the sake of sanity. You wind up with smaller patterns, that often look like this:
So, get it? The two-color technique is called STRANDED COLOR. Anything knit with the other color running along the back, ANYTHING done with that TECHNIQUE, is called "stranded color".
FAIR ISLE IS A HISTORIC GROUP OF PATTERNS BASED IN THE NORTH SEA. They are knit WITH the stranded color technique, and are FAIR ISLE PATTERNED. The hallmark of the Fair Isle is an XOXOXO horizontal striping effect:
Ann Feitelson. If you're at all interested in traditional knitting, it is an excellent purchase and covers a great deal of history and color theory as well as having twenty-ish really nice, well written patterns.
Lusekofta ('lice coats' after the white flecks), or Setesdalen (after the valley of Setesdal where they were unvented) are ANOTHER type of traditional sweater also knit with the stranded color technique. They are very well known, so I'm including them in the retrospective.
Dale of Norway. Knit with stranded color. NOT A FAIR-ISLE. Get how this works? Now that you've seen it, you can look at the Hafjell I knit, above, and argue whether or not it's a "real" Lusekoft because it's blue, and because the pattern across the shoulders is quite big. But you can certainly see what the inspiration was.
BOHUS STICKNING is the name of a Swedish knitting co-op that's been out of business for decades. It is thought they developed the yoke sweater, to showcase their incredible color work, done with STRANDED COLOR:
the Blue Shimmer, pattern available in the book.
So there you go. By now you've probably got the idea why this stuff drives me crazy. Stranded color is the TECHNIQUE. Fair Isle is a specific folk style (that's pretty darn cool). Anyone who finds traditional folk styles interesting, you should look at "Knitting in the Old Way" by Priscilla A Gibson-Roberts and Deborah Robson. They discuss all this in great detail, and lots besides, as well as tweaking the EPS into doing all sorts of amazing things.