How Their Made:
Woven fabric is produced on a loom. It is made by-you guessed it- weaving yarns together. The main property of woven fabric is that it usually has very little stretch when pulled either widthwise or lengthwise. Because of its limited stretch most garments sewn from wovens have to incorporate shaping in their seams in order to fit properly. Wovens also fray and therefore require seam finishes to make sure that your project doesn't unravel over time.
Knits are made on a knitting machine. It is produced by interlocking yarns together through the use of needles, very much like hand knitting except it involves a lot more yard and a lot more needles. Knits have a lot more stretch than wovens do, especially width wise. This stretch allows knit garments to have minimal shaping integrated into the design. Knits don't often fray and don't necessarily need to be seam finished however they can be prone to runs.
As seen in the picture above, woven fabrics look similar to how a basket looks with crisscrossing yarns that run lengthwise and widthwise.
Knits however resemble a braid with interloping yarns that run lengthwise.
It can be tricky to tell the difference just by sight. Sometimes the weave or knit is so fine that its hard for your eyes to pick up. If this is the case than a stretch test will help you determine the difference between the two.
When you stretch a woven either lengthwise or width wise you will find that both directions have little to no stretch. The only exception to this is when the yarn contains elastic.
When you pull a knit fabric across its width you will find that it has significant stretch to it. If you pull knits lengthwise, it will still have a slight stretch.
Make it a habit when you are in the fabric store to examine the many different types of textiles available. Look at the weave, preform a stretch test, and see how it fells. If you continues to do this soon you will be a pro at distinguishing knits from wovens and hopefully gain some inspiration for your next project!