if it's feltable, you could try remaking it into something else entirely...a bag is what my sleeveless red sweater will become.

I do quite a bit of sweater repairs. Basically you duplicate stitch over air where the stitches should be. Start a few sts to right of hole, work sts leading towards hole via duplicate stitch, create new sts over hole, work a few sts to left of hole. Repeat for every row. Mary Thomas has a nice section on darning holes. Its an old fashioned skill~ mainly for mending socks etc way back when. I doubt our foremothers would spend close to $20 for sock yarn then discard them when they were all holey. But we, who live in a throw away economy and view sock knitting as a diversion instead of necessity, seem to devalue our work by not mending it.

Applique. Or make more holes, on purpose, for a kind of punk lace.

if it's a plain sweater i like to embroider over mothholes. sometimes i'll cover the entire sweater with a repeating geometric or swirly pattern if there are lots of holes in random places. if it is just one hole it might only need a little whale or something as a utilitarian decoration. really it depends on where the hole is.
i'm not sure what i would do if it was on a busy patterned sweater! let's hope that never happens.
and hey - thanks for your comment on my crochetme.com pattern!

Particularly for store-bought sweaters with small gauge, I end up crocheting an edge around the hole (sometimes cutting the hole to make it larger first) and then inserting crocheted shapes inside. I make sure to use a constrasting thread for maximum effect (brown with neon blue, etc).

if the hole is smallish, an easy solution is needlefelting a bit of yarn or fibre in and around it. could be decorative or not.