Abstract: An apparatus and method are provided for forming coils of yarn and for heat setting the yarn. The apparatus has a coiler adapted to receive yarn from a yarn source ant to form the yarn into a plurality of loops of a desired size. The coiler preferably includes a supporting frame, a pair of feed rolls mounted on the supporting frame and adapted for feeding yarn from the yarn source, and a rotatable coiler tube positioned downstream from the feed rolls. An air blowing device is positioned between the feed rolls and the coiler tube for facilitating the advance of the yarn into and through the coiler tube. A first variable speed drive is connected to the pair of feed rolls and a second variable speed drive is connected to the coiler tube for rotating the coiler tube at a selected speed to thereby form loops of yarn of a desired size.