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Acoustic panels such as these from Auralex can be used to help dampen sound by mounting them on walls.
For any home theater, you need to be aware of the quality of sound and the amount of sound leaking from the room. Family members in other parts of the home and your neighbors should not be disturbed by what you're watching, so soundproof the room as much as possible. There are two ways to do this:
For new homes or full remodeling, it is best to install zero-sound drywall. It absorbs sound, is thick, and since the drywall is the sound barrier you can decorate the room with normal paint and materials.
For existing rooms not going through a full renovation, the use of light blocking/insulating drapes helps with sound deadening, along with carpeting the floor. Carpeting has ratings for sound dampening, so look for carpeting that helps soundproof a room.
Another option is to mount acoustic panels on the walls. The panels are made specifically to isolate and absorb sound and to improve the acoustics of the room. The drawback of acoustic panels is that they are not very attractive, although some are available in different colors or have art or photos silkscreened on them.
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