Original: Blankets were traditionally made of wool because of wool's warmth, breathability and natural fire-retardant properties, while sheets were made of cotton or linen, which are less irritating to the skin. Nowadays, synthetic fibers are frequently used for both.
Simplified: Blankets were traditionally made of wool because it is warm, naturally fire-retardant, and allows air to circulate well, while today synthetic fibers are frequently used.