Highly stretchable thermochromic wrapped yarns, which employ elastane filament (EF) as core, stainless steel wire, and thermochromic polyester filament as the first and second winding, was prepared, and the effect of elastane draft upon yarn properties was investigated. It was found that the elastane draft played an essential role in determining the final yarn behavior, and the optimized elastane draft parameter was 2.5 using Technique for Order Preference by Similarity to Ideal Solution. It is a distinctive configuration of yarn’s constituents and the EF draft that are responsible for the exceptional stretchability of yarns, and it showed mechanical robustness following cyclic stretch. Importantly, the yarn exhibited rapid, durable, and reversible color conversion when subjected to cyclic voltage, cyclic abrasion, and alkali. Finally, a flower-shaped pattern was fabricated by embroidering yarn onto an elastic substrate as a proof-of-concept, and no obvious variation of color fidelity was observed during the stretch.