Abstract: A warp knit two-way stretch fabric is formed by knitting a ground construction of inelastic yarn in a two-needle overlap pattern and laying elastic yarn into each course of the ground construction, the laying-in motion exceeding the underlap motion for the inelastic yarn in the same direction in the same course by one needle of the knitting machine. In the resultant fabric, each end of laid-in elastic yarn lies substantially parallel to the wales of the ground construction and is covered in each course by a full wrap of an underlap segment and a half wrap of the segment interconnecting the two loops formed by the two-needle overlap of the inelastic yarn.