I'd crochet something, or maybe I'd knit something instead. Alternatively, you could give it away on Freecycle or try to sell it online.
Seriously, how thick is this stuff and approxiomately just how much yarn is this? I don't have a good concept of how many yards makes a project (though I do understand enough that the thicker the yarn, the more it is for any given length.) Are we talking enough to make one adult sized sweater? 4 adult sized sweaters? 20 adult sized sweaters?

Varigated yarn looks beautiful when stitched up with a very simple pattern. It also works nicely in granny squares with co-ordinating solid colors.
Also, what do you need? Do you have enough throw blankets around the house, or would an extra blanket get used (assuming there's enough here for a blanket.) Does anybody need more sweaters? Do you want to use it for holiday gifts for next year?