We have a large window, such as yours and light yellow walls in our house. We bought rust colored curtains and have a beige/olive/yellow rug and a grey couch.

I have a gargantuan window like you, and I also still have the curtains that came with the place. I am planning on doing a double layer thing: lightweight white on the inside and then something heavier for the outer layer. I am partial to grays, greens, and geometric shapes but I'm sure you could find something to suit your tastes.

Adorable room and dog! I'm a big proponent of making your own curtains. For big windows like you have, buying fabric can save you a lot of money and allow for optimum customization. First, I would buy a set of plain sheer optic white curtains for the underlayer, as well as a dark colored double rod kit wide enough to leave room on either side of your window (the dark color will contrast nicely with the yellow walls). I think the best prices for those two things can be found at overstock.com or possibly at ikea. Then, I would get a deep taupe linen by the yard. European linen is great because the weave allows in light but also does a fine job of keeping things private. A mauve-y/taupe-y taupe color will compliment your couch and walls nicely. Make sure to measure your windows and get fabric wide enough to cover your window with two panels. I have very high ceilings in my brooklyn apartment and am partial to expensive, restoration hardware-esque linen that is not in my budget, so I set out to find a less expensive alternative by the yard that I would make into curtains. In NYC I found great European linen at $7.00 a yard, and I'm sure you could find a similar deal online! After that, just measure out the proper length for each panel, sew a rod pocket at the top (there are many youtube curtain-making tutorials) and a hem along the bottom and you're done! I would get a double rod kit that also comes with matching tiebacks, so you can sweep away the linen and or the sheer undercurtains without banishing them to the corners of the rods. Hope this helps!

I'm in the custom window treatments business. I always start out with these questions:
1. Do the lower windows open and are you the type who opens the windows? (you'd be amazed and the number of folk who don't.)
2. Are you looking for 100% privacy at night?
3. What direction do these windows face? Is there a problem with glare? Heat gain? Cold?
4. How How much are you willing to invest in your window treatments? If you rent, maybe not so much. If you own, you are likely to keep them for 5-10 years (or longer), so investing a bit more in terms of quality products is something to consider.

2" wood or faux wood blinds are popluar, and common. They are a good choice for light control and privacy and can be dressed up easily with side panels or top treatments.

Modern roll shades come in lots of great fabrics and offer a clean uncluttered look. A light filtering fabric shade with a wood hem bar would look great in your windows.

Roman shades are both classic and modern. They pair wll with side panels too. Some roman shades can be made with top-down-bottom-up option so you can see the sky but still have privacy.

Sheers and sold panels would also be a good option. Because ready-mades are only 50-54" wide, they can look skimpy. You could get a more luxe look by using three panels on your double window--2 on each side and one in the middle. If you can, choose a 96" panel so you can hang them at least 4" above the trim. It helps to add visual height and, frankly, looks less cheap.

I think this is the perfect scenario to do something like this:

http://www.younghouselove.com/2008/06/curtain-call-2/

One wide bamboo shade with breezy white floor length curtains hung high and wider than your window frame.

I think it's an appealing look and the neutral colors would look great against your wall color.

I have a very similar window, probably same width (mine is 114" wide) but it starts less than a foot off the floor. I think the height is 72".
Instead of yours two vertical sections, I have three. I really don't anything during the day (there is a mesh on the outside) but when the light is on, privacy is an issue. I purchased 3 cellular blinds, they are cordless. When retracted, you would not even know there is anything as the case blends with the window frame. When pulled down, each cell has the hexagonal shape. They are not see through, but they let light in. Similar ones also exist in the "blackout" version - the inside of the cells has black lining. I am extremely happy with the blinds, as well as with the price. Each was only $60. Now I am working on getting some curtains (I prefer solid fabric with the back tabs). Unfortunately, most curtains are available in 84" length and I need 96" (the house does not have overly high ceilings so I compensate for it by hanging the curtains an inch below the ceiling and going all the way to the floor.

Nice puppy!

I'm honestly not a huge fan of blinds... I love blackout curtains over sheers though. You can use sheers to let light in but keep eyes out, and the blackout curtains for everything.

I also prefer floor to ceiling. It accents more than just the windows. If you're into valences, they can be done very well, or you can get some nice curtain rods as well.

i like easily distracted idea "Roman shades are both classic and modern. They pair wll with side panels too. Some roman shades can be made with top-down-bottom-up option so you can see the sky but still have privacy."
ive got the top down bottom up roman shades in my living room and I found them odd at first but love them now. I can still see out but i dont have to ever touch them to get privacy, i just leave the top half down along the windows seam 100% of the time.

I used to recommend pleated shades under horizontal wood blinds, but my dogs are destroying mine. I may switch back to curtains, which may be more durable. You have a nice dog and a nice place. Good luck!

I am also in the custom window treatment business. For what you're looking for I would really recommend a semi-opaque cellular shade. I would actually divide it into two shades for your large window. Hunter Douglas has some great fabrics. They let light in, but block out any possibility of people seeing in. They come in top-down bottom-up which is a great feature for a living room. To make the window look more custom, I would then add pinch-pleat panels on either side and an upholstered cornice in the same fabric as the panels.

Cellular shades are also quite energy efficient as they insulate the windows. Who can't use a little extra insulation? :)

I have a similar issue with my window - I have a large south-facing window in my condo living room and I was planning on leaving it treatment-less ....until i realized that the sun BEAMS into my space during the winter months. I literally need to wear sunglasses to see the TV. I'd appreciate any advice on what kind of treatment would look good in my space : http://cointrin.ca/?p=1039

@cointrin26, The southern sun on winter afternoons is intense here, too. I covered a bedroom southern window with an insulation fiberboard sheet cut to fit inside-mounted concealed under traditional treatments. That window has no view and there's a larger eastern window with a great view, so it works well. That wouldn't work in a living room, though. Maybe blackout curtain panels would work in a living room.

Ikea has grommet curtains for $20/pair. I don't think they are lined so they will let in light as well.

Thank you all for your comments, they are really helpful. I don't like shades too much, because I like to be able to see outside (my dog also loves watching people and cars go by) but I'll definitely consider them before I make a decision.

hi there...i am also a window treatment specialist AND live/work in dc. Your windows look like great place for skyline gliding window panels. contemporary, clean and cool - and reasonably priced. here is a link to a pic http://bit.ly/frcC6G lots of cool fabrics to choose from, sold locally through ace hardware dc. I have done them in a few DC condos and they look great. would suggest they hang just at window sill so the dog doesn't totally ruin them. feel free to visit www.acehardwaredc.com to schedule a visit. will measure and price for you. good luck!