The guest bedroom is the one room in the house that you aren't decorating for yourself. Therefore when you go to design the rooms decor, it is important not to get in your own way. Overdoing the decoration in this room will be a disservice to guests by reinforcing the fact that they are not in their own home. As comfortable as they may be with you, they will never be as comfortable in your home as they would in their own setting. On the other hand, failing to place those few simple pieces that make a space feel personal; will leave the guest room feeling cold and empty.
Arguably the most important item in the guest room, the item that turns it from an extra room into a guest bedroom, is the bed. The bed does not have to be visible. You can have a regular bed, a fold out couch or futon, or a semi permanent bed such as a cot or an air bed.
A regular bed will cost you some space, and a full mattress can be expensive. If you get a small twin sized bed you can throw some pillows on it, place the long end against a wall, and let it double as a couch. A sofa bed does this even more effectively, creating a room that has a dual purpose. Futons are also often less expensive then full mattresses. The least expensive method is a removable bed, such as an air bed or cot. This can open the room up completely, allowing it to double as a gym, sitting room, or library. Usually these beds are very uncomfortable however some of the better quality air mattresses are being made to higher and higher standards. Be sure to try it out before you buy, and make sure that you only get one that is self inflatable.
After you have settled on the bed you have to fill in furniture. If the room doubles as something else, such as a gym, you will have to work around that. A traditional guest room will contain a set of drawers, and a small table. Additionally you can add TV stands, plant stands, or desks, if you have the room. Think of a hotel. They provide just enough to make a person feel comfortable, but they are sure never to clutter the room.
For ambience you can add lamps and different lighting. Lighting is a decoration on its own that is much understated. A floor or desk lamp can provide both illumination and décor. Adding a television or a radio is also a nice touch if it's in the budget. These items can be used even when the room is unoccupied, as a way to relax in a secluded setting.
The finishing decor touches should be small. Any artwork placed in the room should be restrained, don't force extreme tastes on others. Impressionistic prints are often the right touch to complete the room. Wall clocks or desk clocks are also a nice way to make a room feel more comfortable.
Decorating a guest room is fairly uncomplicated. You want to provide just enough so that the person in the room is comfortable, without overloading them with your decoration. Just remember to keep it simple, and you should be able to design a room that will make it hard for you to get your houseguests to go.