One of the most common issues that newbie knitters face (myself included, long long ago when I began) is knitting too tightly.
Karin was having some troubles with the lace knitting I taught you about here because her stitches are too tight. To loosen up your stitches, really you just need a lot of practice knitting, you need to be able to realize that your stitches will not randomly fall off the needle if you loosen up your loops and let the stitches breath some. Its like learning how to drive, once you realize that the road will not jump out from under you, you can relax and enjoy the view a bit more. Knitting is the same way, it takes practice, patience, and the realization that you need to let go some :)
If you find that you continue to knit too tightly and it seems that there is nothing you can do about it (like my mother (hi Mom!)) then I suggest moving up a needle size or two. This will help the yarn breath because, for instance, if you are using a worsted weight yarn and size 8 or 9 needles, moving up to a 10 1/2 will allow the yarn a bit bigger gauge and it won't knit up so tightly naturally and you don't have to do anything about it.