This Oregon flag design is the best I have ever seen. I found it at andrewrogers.net, and it was designed by Brian Truncale, who designed many improvements to an original design by Andrew Rogers. (more info at andrewrogers.net)
Blue and yellow are the state colors of Oregon. The stylized bird in the canton area of the flag is a meadowlark, the state bird of Oregon. It is not only in the place of honor, the canton, but the direction it is flying in represents Oregon's geographic position in the United States.
Many other versions of the flag can be found at andrewrogers.net.