I put this together for another thread, and thought you guys might find it informative::

1) Obtain paracord of your chosen color. I recommend "real" 550 parachute cord, with white strands inside a colored outer sheath, rather than the braided stuff you get at WalMart.
2) Cut the paracord to length. For a plain-vanilla aluminum AR15 FF tube, you will need about 4 feet of paracord for every inch of tube you want to cover - I found I needed more for the wider LR-308 FF tube (about 50ft total IIRC). Once cut, heat-seal the ends using a lighter flame to prevent fraying.
3) Cut another length of paracord to approximately 18" long, fold in half, and then tie a knot with the loose ends to create a loop about 9" long.
4) Soak the longer length of paracord (from step 2) in water until its saturated, then shake off the excess water. This is an important step, as it makes the paracord stretch slightly.
5) Starting with one cut end of the wet paracord several inches in towards the middle of the FF tube, lay the paracord lengthwise along the tube towards the end you want to start wrapping. Now start wrapping the paracord around the tube, keeping things as tight as you can and working your way towards the opposite end. The wrapping will cover the first several inches you had initially layed lengthwise, thus preventing it from unravelling. Keep an eye on things to make sure the cord lays parallel and no big gaps/distortions develop.
6) When you get within about 5" of the end, lay the 9" long loop of paracord lengthwise on the FF tube (knot towards the center of the FF tube), then continue wrapping the para cord so as to cover this loop. This loop needs to protrude about 2" at each end.
7) When you get to the end of the FF tube, insert the loose end of paracord through the protruding loop, and then pull on the opposite end of the loop so that the loose end of para cord is pulled under the wrapping and out where the loop is protruding.
8) Cut off any remaining loose ends of paracord, and heat seal as flush as you can with the wrapped surface.

Once the para cord dries, it will tighten down nicely and prevent the wrapping from unraveling. I have wrapped several rifle FF tubes this way, and the wrapping has lasted indefinitely... I have never had one unravel despite years of hard competitive use in the AZ heat. Of all the FF tubes I have ever handled, my paracord wrapping is by far the coolest to hold.

The process is illustrated below:

The mspaint just made your work even more awesome.  

Do you have a pic of one that you have done?  I'd love to see one.

I have a PhD in MS Paint

Below is a diagram of the method I used for a 550 cord wrap on a friends 450 Bushmaster upper, it's just a bit different but the concept is the same. Unfortunately the upper has since been sold and I can't find any pictures of it.

Here is a link to m4carbine.net where the OP wrapped his rail with cord.

http://m4carbine.net/showthread.php?t=70744

Hmm, I should wrap my handguard like I did with the handle on my Mec shotshell press. It was about 6 hours of work though.

The blue and grey are 450# rated paracord from vtarmynavy, and the thin green stuff is 150# rated mil type 1 paracord that I saved from a dumpster in Iraq.

Here you go:

Thanks.  Im doing a build similar to the bottom pic.  I think Im going to try that on mine.

Hey that looks cool...

Does it cause any heat problems?  Seems like it would insulate the barrel as it "breathes" through the handguard?

None of those are done on ventilated tubes.  There is still plenty of room for the barrel to "breathe" and the 550 cord insulates the hand somewhat from a hot float tube.

Not a noticeable problem in my application (3-gun). My free-float tubes are all open at the muzzle end, so there is plenty of space for air to circulate around the barrel. The barrel nut/handguard itself does act as something of a heat sink, and therefore does retain the heat a bit longer... like anything in life, its a tradeoff. I prefer cool hands when I am shooting, and the gun has plenty of time to cool off between stages.

Here's mine, been like this for 2 years...

Did it a little differently, since my VTAC had slots.