I have project bags and a small knitting bag which I keep inside a larger knitting bag. In my project bag (which is usually a very large ziploc bag), I put the WIP, with needles, and the yarn for the project along with a copy of the project pattern (usually in a page protector). On the outside of the bag, I label it with the project name, the name of the yarn(s) I'm using for the project, the size and length of the needles and the date I started the project. As I usually have several works in progress, I may have numerous project bags around. I keep them in my large knitting bag, which is actually on of those sewing/craft bags that you see everywhere...the ones that are attached to a wooden frame that you can fold up and carry from room to room and then set open on the floor beside you. I currently have five project bags, labeled and ready to go. I tend to work a little on one project and then put it away and work on another one. That's why I label them with the project/pattern name, etc. Sometimes a WIP can set untouched for a few months. I also keep my collection of needles in my large knitting bag. In my small knitting bag, which is actually a pencil pouch, I keep my knitting notions (stitch markers, stitch holders, a small crochet hook for fixing dropped stitches/runs, etc.)
This way I keep my WsIP clean, I don't inadvertently use yarn I purchased for one project on another project, and if I want to take a project with me to KIP, I can stop at one place grab a project bag and the small knitting bag (so I'll have my markers, etc.), put them in my purse and I'm ready to go in a second.
I'm Yarnrainbow on too.