DLTK's Crafts for Kids
Sawdust Clay

Mix sawdust and flour.  Add water, stirring, until dough is stiff.  If dough is too crumb-like, add a bit more water and flour (a bit less sawdust)

Knead on a wax paper covered table.

Mold into shape (animals, flowers, bowls, etc).

Set in a warm, breezy spot for about 48 hours until dry.

Sand with fine grit sandpaper.

Paint with acrylic or tempra paints (acrylic coats better, but doesn't come out of clothes)