Making a Welt in Knitting
Video Tutorial (above, no second needle used to pick up sts along the marked row)
Hold your working needle up to the marked sts (WS on the inside, RS are facing outward), knit the first st from your needle with the appropriate st on the marked row. Work across the row in this manner. Some people like to pick up the sts on the marked row with a smaller needle to work a welt.
Be sure to count that you have the current number of sts to match how many you have on your needle. As noted in the video, I discovered that I needed to pick up the selvedge sts in order to have the correct number of sts.
Picture Tutorial (below, using a second needle to pick up sts)
Step 1: Using a second needle (some people like to use a smaller sized needle to more easily perform this, but that is not necessary), pick up and knit sts along your marked row. In this photo, it is marked by the transition from the natural white colored yarn to the natural dark grey colored yarn. (A circular needle is being used here so that either end can be used to work the next step.)
Step 2: Be sure to check that your number of sts match for both sets of needles. Then orient the two needles parallel to each other to prep for the next step. You will want your two needles to sandwich together such that the WS is on the inside and RS is facing outward.
Step 3: Using a third needle (or the other end of your working needle), knit the first st on both needles held parallel together. Repeat across the row.
Shown here is the row partially done. The welt is forming on the right side, while sts still need to be worked on the left side. :o)