I find the best collage materials are the ones that cost me little or nothing. Here are some ideas:
punched circles from a three hole punch
paper scraps from previous projects
tissue paper, ribbon & old wrapping paper recycled from gifts
old catalogs
junk mail
drinking straw pieces
rice
sand
rocks, sticks, leaves, pinecones
dried grasses & flowers
lentils, small beans
yarn
dryer lint (no kidding)
...and, of course, the obvious: glue, markers, crayons, construction paper and paints.
Since scissors are often a problem for young ones, encourage them to tear pictures or shapes for their creations. The imagination can definitely be sparked with the interesting shapes created by tearing paper. There's also the wonderful tactile experience and, of course, the SOUND.
Paper Plate Collage
paper plate (double layer for thinner plates)
glue
water
small paint brush
small disposable (paper or plastic) bowl
collage materials
Dilute glue with water and put into small bowl. Show child how to use small paint brush to cover surface of paper plate with glue mixture. Allow child to decorate plate. The beauty of this is that the sides of the paper plate keep the various collage items on the plate. There's less mess and less frustration for the child, too.