One of my needlepoint books calls this stitch "one of the best background" stitches. I am not sure that I totally agree with that (though I do like the stitch). However, I definitely agree with the book's additional comment that the stitch has "texture and a good amount of eye appeal."
Essentially, the knitting stitch is a diagonal stitch over two horizontal canvas threads and one vertical canvas thread. The direction of the stitch alternates from column to column creating a finished product that looks very much like the stockinette stitch in knitting. Obviously, this stitch would be a good stitch for any area where a knitted look is desired (such as sweaters, mittens, scarfs, etc.)
Because the stitch looks like knitting and is used to mimic knitted garments, wool is an obvious fiber choice. However, you could also use a 50/50 silk/wool blend for a more luxurious look or cotton for a more summery effect.
The stitch is firm and hard-wearing. It is easy to do and works up fairly quickly. One tip is to remember that each stitch starts one mesh above or below the last stitch.
Some of the variations that we explored included using two colors for a striped effect, shortening or lengthening the diagonal component of the stitch so that instead of going over two horizontal canvas threads you would go over one or three. Mindy, one of the attendees of our Stitch of the Week class (and a reader of this blog -- Hi Mindy!) also invented a variation where one column of stitches is done over one horizontal thread while the next column is done over three horizontal threads. The end result is a up-and-down effect where the over three columns come forward while the over one column recedes (light blue stitches above at far right, both photos). A pleasant effect.
The stitch can also be worked horizontally. In two shades of green one of my needlepoint books suggests that it would make excellent grass and I think it probably would.
I used the knitting stitch in my AVA pillow (I know, I know I said that I wasn't going to talk about it anymore!) and I really like how different it appeared from all the other stitches. If you haven't already tried it, give the knitting stitch a go. I don't think you will be disappointed.