I do what gaigai referred to in her post. It makes it soooo easy to see what you have color-wise, and keeps your fabrics from getting all messed up. Here's a link to a video that shows you how to do it.
http://tipnut.com/fabric-folding/
You can get the insulating board at Home Depot or Lowe's or whatever home improvement/lumber yard you have in your area. It's just rigid foam insulation for building.
Happy organizing!