I've lived almost my entire life in Colorado Springs, but last fall moved to Brooklyn, NY.
My mom and I are huge crafters and so here's a list of all our favourite places:
American Classics Marketplace - Constitution and Academy. There's an awesome yarn vendor who sells books, needles, hooks, magazines and tons of unique yarns in the very North West corner of the place (in the more warehousey area).
Ruth's Stitchery - near the intersection of Barnes and Austin Bluffs. It's next to where the DMV is or atleast use to be. It's an embroiders paradise! My mom loves that place but it's a bit expensive.
Tandy Leather - on the east side of Academy just before the Maizeland intersection. They sell mostly leather goods. But if you're making a purse or need awesome clasps and things, it's the place to go!
and if you're ever in Denver. The *MOST* awesome fabric/felting/yarn place is Fancy Tiger. I miss Fancy Tiger SOOO MUCH!