Traditionally, wainscoting is a combination of decorative paneling and molding that extends part-way up a wall. Starting in the 1300s, the Dutch used wainscoting as a way to protect their plaster walls from damage caused by chairs, boot spurs and other hazards. In the past, wainscoting was thought of as a dinning room decor choice. Today, wainscoting is used to bring visual interest to bedrooms, bathrooms, hallways and foyers.
Instead of gluing and nailing paneling to the walls, try painting vertical stripes partway up the wall. Pick colors that are only a few shades apart and alternate them. For additional interest, make one color's stripe twice as wide as the other color's stripe. This method can be used with or without a traditional chair rail covering the seam where the two halves of the wall meet. To eliminate the chair rail, paint a white or light colored horizontal stripe to separate the wall.
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Wainscoting panels are usually more expensive than plain hardwood panels. Use plywood or another hardwood panel and stain or paint it. Glue and nail it to the wall with the grain running vertically to help hide the seams between each board. Hardwood panels are usually hidden under a finishing material, so it might take a lot of weeding through damaged or pitted boards before finding enough nice panels to finish a room.
Panel molding can be used to create a three-dimensional faux wainscoting. Panel molding can be used to create simple rectangular frames or elaborate designs. Paint the panel molding the same color as the wall to create a seamless look.
Create a custom wainscoting panel look for a fraction of the cost by using baseboard molding. It is usually flat and thin and comes in a variety of widths, which can be mixed and matched for visual interest. Glue and nail the baseboard molding to the wall in vertical and horizontal strips. Leave small boxes of wall exposed. Paint the entire area the same color, or paint the wall a slightly darker shade for added effect.