A method for forming yarn provides for forming an intermediate product being a fire retardant and heat resistant cohesive elongated network of fibers in a single operation by stretching and breaking filaments of a ribbon like tow starting material of longitudinally aligned filaments. The intermediate product may be wool-like with wavy and randomly oriented fibers formed by from the fragmented filaments. The single drafting operation includes directing the tow through first and second pairs of rollers, the second pair rotating faster than the first. The intermediate product may be spun directly into yarn in one spinning/twisting operation. The fire retardant and heat resistant yarn so produced may include 100% oxidized polyacrylonitrile fibers having an average length greater than about 15 cm. The yarn may be knitted or otherwise formed into fire-retardant and heat resistant fabrics or other products used in various applications.