Abstract: A pile fabric is formed of interengaging ground yarns and cut pile tufts. The tufts are formed of wrap yarns extending upwardly from the ground yarns and forming the face of the fabric. Each of the wrap yarns comprises a body strand of untwisted staple fibers and a crimped textured binder strand which has extensible and retractable properties. In the wrap yarn, the binder strand is helically wrapped around the body strand in an axially extended and tensioned condition and is reduced in bulk compared to the condition the binder strand would assume when relaxed. When tufts formed of such wrap yarns are cut to form the face of a cut pile fabric, the binder strands retract and position themselves inwardly away from the face of the pile fabric so as to be hidden among the pile tufts and not visible. The retraction of the binder yarns and the appearance, hand and integrity of the resulting fabric can all be enhanced by various finishing processes.