There was some geographical pass called The Eye of the Needle--a rocky pass. Camels could pass through it, but only with great difficulty. But the source of the metaphor for this rocky pass would have been the needle that was used by those ancient tailors.

http://www.biblicalhebrew.com/nt/camelneedle.htm

The above url debunks the myth about the camel's pass through a gate in Jerusalem. Interesting reading.