Originally posted by: etech
The wire mesh will work but I like to back it up with something a little more sturdy. This is how I have fixed larger holes.
Clean the edges of the hole so the are straight and have no little cracks in them.
Find some thin wood sticks, (hint this is a good excuse to buy some popsicles) that are at least two inches longer than the hole. Put some glue on the ends of the sticks then put them into the hole so the glue will be on the inside of the wall. A good idea to hold them is to use a rubber band around them and another stick that you leave on the outside. Let the glue dry(wood glue works well) and then just cut the rubber band off.
Then use the wire mesh that the others have referenced to line the hole. One side will be sticky to hold it to the sticks.
You won't be able to patch the hole with only one application of plaster, joint compound, mud or whatever they call it there. Fill the hole even with the wall and let it dry for at least 24 hours. Use some 150 grit sandpaper with a sanding block and sand it down fairly smooth. It doesn't have to be perfect but make sure that all high spots are gone. Reapply the joint compound feathering it out a little further on the wall. Wait till dry and resand. When the area is perfectly flat and smooth, paint.