Here, ridiculously behind schedule, is the last document I was trying to finish in September when the system shut down (just enough minutes ahead of schedule, for no obvious reason, to keep the document from becoming visible. Does anybody want to read about September phenology in December? I don't know, but I might as well post this and get it out of the way!
Several kinds of moths feed on walnut trees and may be known as Walnut Moths or Walnut Caterpillars in some places. The one that is occasionally confused with Tent Caterpillars or Gypsy Moth caterpillars is Datana integerrima, a member of the family Notodontidae. In years when their populations are high, Walnut Caterpillars can be an unsightly nuisance; in our part of the world, however, they infest walnut trees too late in the summer to be a real pest.
Here's the Ohio State University fact sheet on Datana integerrima:
Walnut Caterpillar hatchlings are reddish; as they molt their skins become progressively darker, and by the time they start exploring the world beyond their host trees they can be described as black caterpillars with fluffy white hair. Like Fall Webworms, they spin large unsightly webs around the ends of trees, usually but not always walnut and hickory, while eating the leaves. Like Tent Caterpillars, they leave their nests and wander about for a few days before pupating; as mature caterpillars they're about two inches long, sometimes longer. Also like Tent Caterpillars, they often rest in large groups and, though mostly harmless, repel predators by squirming.
Then again, their activity in autumn (late September and October, even as far north as Michigan) might cause Walnut Caterpillars to be confused with various black and white "Bear" and tussock moth caterpillars. Most of these species look different from Walnut Caterpillars, e.g. this cute little tussock moth (also found in Virginia in autumn): http://www.wktv.com/news/health/Officials-black-and-white-caterpillars-are-not-poisonous-127304863.html.
However, scientists classify Walnut Caterpillars as a completely different family from Webworms, Bears, tussock moth caterpillars, or Tent Caterpillars because both moths and caterpillars have a different body shape. While Webworms move their heads from side to side to repel predators, and Tent Caterpillars can bend almost double in any direction, Walnut Caterpillars can bend themselves into a U shape, raising both their head and tail ends at the same time. Later, as moths, they will retain this tendency to arch their backs. The Notodontidae are sometimes called Prominent Moths because they often rest with their tail ends "prominently" pointed up above their wings.
Walnut Caterpillars are very common in the Midwest, and sometimes manage to be pests on nut trees. In Virginia they're uncommon; I'd lived in a house shaded by a walnut tree for twenty years before I ever saw one. Once in a while, when weather conditions are favorable and the animals have become a serious nuisance in the Midwest, we do see what scientists call an "irruption" or sudden population explosion of Walnut Caterpillars in Virginia. This happened in 1985; I'm not aware of its having happened in any other year during my lifetime.
Like almost all hairy animals including humans, Walnut Caterpillars can shed enough short, coarse hairs to irritate human skin, but they're not poisonous. As observed in other "Know Your Pest" pieces here, most people who want to pick these caterpillars up in their hands have no problems with their fur, but people who've got one down their neck often report itching or a mild rash.
When they defoliate trees that aren't already losing their leaves, as can apparently happen in Texas pecan groves, Walnut Caterpillars become pests. However, it's not necessary to destroy their natural predators (they already have few enough natural predators!). As with the other nest-building caterpillars, you can use a stick, garden rake, etc., to pull the nest out of an endangered tree. Some caterpillars will survive, but since predators will be unharmed and you'll be able to burn, drown, or crush most of the caterpillars, the tree will be safe.
It's also possible to buy other insects that parasitize enough of the caterpillars to keep their population under control, next year. Here's a list of helpful insects, along with other data:
In the North, surviving walnut caterpillars jump or crawl down from their host trees in September or even early October. The trees are unharmed. The caterpillars may even have a slight beneficial effect by reducing the amount of walnut leaf litter that decomposes into the soil; walnut trees contain a chemical that inhibits the growth of many other plants. The caterpillars pupate in the soil all winter, then emerge as moths in early summer. Moths as well as mature caterpillars seem to mimic Tent Caterpillars, which contain enough cyanide to discourage most birds; Walnut Caterpillar moths are a little smaller than Tent Caterpillar moths, and have different structure as well as different color shadings in their wings, but to the casual observer they look similar.
However, in warmer climates, specifically Texas and Oklahoma, these caterpillars have evolved a lifestyle that makes them more problematic. According to http://entoweb.okstate.edu/ddd/insects/walnutdatana.htm: "There are two generations of this pest per year in Oklahoma. Moths emerge from mid-May to early June and in late July and early August. Larvae feed on the leaves in June and July and from late August into October. The larvae are gregarious and feed in groups, but do not spin webs in which to feed."
So, if you see these caterpillars in the South, you might want to invest in a few natural predators.