Decorator Alexa Hampton lays down the law on area rugs.
Rugs also exert influence on the rooms in which they are placed. They protect the floors, they muffle sound and they lend softness to the hardscape.
As a rule, I choose a square or a rectangle. In rooms with attractive floors, I prefer area rugs that show some of the surface underneath—if it's a big room, this means leaving a foot (and sometimes up to 18 inches) of floor exposed around the perimeter. If the room's floors have their own border, I try to keep it visible. However, I am always leery of leaving too big of a space around my rugs. Often the result is that the rug appears to be a postage stamp floating on the floor instead of being tied in to the room itself. In smaller rooms, I reduce the floor exposure to 6 to 12 inches.
The biggest determining factor for sizing a rug is where the walkways in the room will be. You must either cover the walkways or not. You cannot bisect a walkway, because it will cause people to trip.
I also think it is important to have some of the furniture be half-on and half-off the rug, to tie all the room's elements together. Big pieces of furniture at a room's edge—like a sofa, club chair or console table—are perfect candidates for this approach. The obvious exception is in dining rooms. Here, the rug must extend well beyond the table and chairs so that when the chairs are pulled out, they're still on the rug.