Knitting is a good Hobby since people can make things. Some charities and even hospitals accept donations of knitted Blankets. One such Hospital is Children's Healthcare of Atlanta. This hospital serves children in the Atlanta area who are sick and need treatment. The blankets provide comfort and warmth for the children who are staying there. If you're interested in donating a knitted blanket to this hospital, send an email to them. The blankets must be new and in good condition.
If you're not in the Atlanta area, look at these websites to try to find information on how you can serve different charities. The two lists have some duplications.
http://www.dailyknitter.com/charity.html
http://knitting.about.com/od/knittingcharities/Knitting_Community_Knitting_for_Charity.htm