Using the Lilypad Arduino, youtube user lovelikerobots made this wonderfully warm knit collar that lights up and blinks once it gets dark. This is a great project to keep you nice and toasty, and, more importantly, visible at night while you are biking through the dark city streets.
A total of 14 LEDs were used, a Lilypad Arduino and a light sensor.
You can create your own less-expensive version (minus the Lilypad) by using the simple circuit used in Glam the Glo bug found in Fashioning Technology. I would also suggest using blinking LEDs.