I often have clients' ask "Is wallpaper in or out?" I believe that wallpaper is always in when it is used appropriately. I do think it has been overdone in the past especially during the Waverly era of the late 80's, too many mini prints and large florals gave wallpaper a bad rap. Foil and flocked wallpapers also stir up awful memories as well. The key is to carefully consider your selection and the application.
Bathrooms and powder rooms are usually a great place to hang wallpaper for a couple of reasons. There usually isn't a lot of wall space in these rooms so you don't overdue a good thing yet it's an opportunity to add something decorative without having to force artwork that could feel overbearing in the space. Foyers are also a good place for wallpaper; consider something tone on tone and classic like a damask pattern. By using wallpaper kids rooms can be playful and fun and a laundry room can look more inviting.
The key is to break it up by interspersing it with solid walls. If your home is very large adding faux finishes into the mix is a great way to keep it interesting. I think the most beautiful homes are a mix of all three.
“Be daring, be different, be impractical, be anything that will assert integrity of purpose and imaginative vision against the play-it-safers, the creatures of the commonplace, the slaves of the ordinary.”
Cecil Beaton quotes (English Photographer and Fashion designer, 1904-1980)