This idea is inspired by this one: http://www.thecatshouse.com/
Step 1: Stuff you need
1x2s from Home Depot are pretty cheap at 87 cents a piece
drill (two drills is best, one to hold the drill bit and one to hold the screw driver bit)
scissors for cutting carpet
hot melt glue gun plus about 6-7 sticks of glue
wood screws (I used drywall screws which are just as good)
Some bits of metal to secure it to a cabinet at the top. I found some of those metal things that are used to block up the unused pci slots on a computer. They probably have a name, don't know it though.
Step 2: Coat everything in carpet
First cover the long sides of the ladder in carpet using hot melt glue to secure it and keep it from unravelling.
Keep in mind where the seam will wind up and try to keep the seams neat and in the back.
I cut the wood for the steps of the ladder to be 5 inches long each. Wrap each of these in carpet and secure with hot melt glue.
Step 3: Assemble
Then line up the rung using other rungs as guides to keep it even. If you have a framing clamp, this could come in handy for this.
Predrill the holes into the side of the ladder.
Then attach the rung with a screw.
I only used one screw, that way I could turn the rung to different angles if I wanted to.