Cereal boxes, snack boxes, and other cardboard packaging are often very colorful with great lettering and fun pictures.  This is the perfect material for a collage project for kids who are scissors-savvy enough to cut thicker cardboard.  For smaller kids, you can help them with the cutting, or use thinner paper like magazines and catalogs which also offer a lot of color and variety in their graphic images.  As your children cut out images and shapes, ask them to think about them--"What does this look like? What could this become?"  Maybe they'll create houses from waffle images or facial features from cereal pictures.  Give them the option of using craft-store glue-on eyes and see what kind of packaged faces your kids can create.

Check out the collages of Henri Matisse and Romare Bearden.