Here is a link to some nice hat patterns.
http://carissaknits.blogspot.com/2007/07/preemie-hats-for-charity.html
I have a pattern for newborn hats using Bernat Softee Baby or Red Heart TLC Light Sport (or a yarn similar in size).
Cast on 72 stitches on size 4 needles.
Do knit 1, purl 1 ribbing for 6 rounds.
Knit until total length is 4 inches.
Start decrease rows:
Row 1 - *knit 2 together, knit 6* repeat around
Row 2 and all even rows - knit
Row 3 - *knit 2 together, knit 5* repeat around
Row 5 - *knit 2 together, knit 4* repeat around
Row 7 - *knit 2 together, knit 3* repeat around
Row 9 - *knit 2 together, knit 2* repeat around
Row 11 - *knit 2 together, knit 1* repeat around
Row 13 - *k 2 together* repeat around
Cut yarn and draw through remaining stitches, weave in ends.
And here is another cute pattern link.
http://www.knittingonthenet.com/patterns/babymockcablehatround.htm