Needles come from Deathsquitos, one of the most dangerous enemies in Valheim. Needles are used to craft the best arrows, Needle Arrows. You can only find them in the Plains biome.
Needle Info Table
|Can be Teleported||Yes|
|Used In||Needle Arrow,|
Most players will want to collect a bunch of needles but it can be difficult to stockpile needles unless you live near the Plains. Deathsquitos are difficult to see from a distance and have no particular spawning location, however, they always spawn in pairs. To farm needles, you just have to roam the plains and keep your head on a swivel.
You can also find a few needles in chests guarded by Fulings inside Fuling Camps.
New players often find deathsquitos absolutely terrifying. After a while, you realize they’re actually quite fragile and great for target practice. When in doubt, hold up your shield and deathsquitos are easiest to kill when they are making a beeline approach to try and stab you. For more detailed information, check out the page on deathsquitos.