It was started by a Maryland quilt guild. The quilters wanted to provide a quilt for every wounded service member coming back from Iraq and Afghanistan. There were more soldiers than quilters, and the project expanded. It is now called Quilts of Valor. Anne Bonney has made one, here it is at the Lake Farmpark Quilt Show.
Here is a photo of the interior of a C-17 Globemaster returning with the servicemen and the quilts.
Further photo and story HERE.