Mercerizing cotton is a process by which cotton fiber is placed under tension while it is bathed in an alkaline solution (like caustic soda), washed and dried. The process of Mercerizing causes chemical changes in the structure of the cotton fiber, making it stronger, straighter, smoother and more dye absorbent.
Mercerizing wool still involves the caustic soda bath, but no tension. Mercerizing wool does not cause chemical changes in the structure of the fiber, but does fuse the scales on the outside of the fiber together. Mercerized wool is, in effect, superwash, and can't be felted. Mercerized wool is also stronger, smoother and more dye absorbent than non-Mercerized wool, albeit for a different reason than the treated cotton.
True Mercerizing can't be washed out because it chemically alters the treated fiber.
More than you ever wanted to know about this subject can be found in the book The Textile Fibres: Their Physical, Microscopical, and Chemical Properties which is available to view online through the Google book search thingie.
The Following 7 Users Say Thank You to dana_renay For This Useful Post: