Modularized insulation blanket for thermal and/or acoustical insulation. The modularized insulation blanket has a cover formed of a distal layer and proximal layer in sealed mated relationship. The distal and proximal layers are sealed along longitudinal and latitudinal heat-sealed seams that define a plurality of modules. The heat-sealed seam may be creased so as to be foldable and/or perforated to provide a tear line. Within the modules are batting blocks. The blankets may be attached to surface structures such as the interior skin surface of an aircraft fuselage, pipes or other structures with retention systems. The blankets may be formed in an apparatus including a platen, heat seal rollers or heating sealing mechanisms, and edge sealers.