temp gauge going haywire, heat acting funny

all of a sudden my temp gauge has started going haywire.  At a stoplight it will rise up near the red, and when I accellerate the gauge drops down to a cooler temp than it should be.  When the temp gauge is way up my heat blows out cold air, and when it goes down the heat blows hot air.  My first guess would be to replace the thermostat, but I'm not sure if thats the problem and I don't want to do anything that is unnecessary.  What the heck is going on here?  Thanks