After seeing a friend's idea at church (thanks, Amber!), I decided to make something like it for Lillian. We started with a colorful paper folder. Then, I chose several sheets of felt in various colors.

I glued a black background to both sides using good ol' Elmer's. Next time, I think I'll use hot glue and I'll tell you why in a minute.

The last and best step was to design/create/cut out whatever Lillian wanted to "stick" to her felt background. If you've never played with felt, it is a wonderful thing that sticks to itself. I used no pattern (isn't it obvious!) and Lillian decorated the face. We cut clothes and decorated with sequins or made designs to glue to the front of shirts. I will use hot glue next time because Elmer's doesn't hold felt to felt very well.

We took our finished product to church last Sunday for a quiet time activity. I ended up doing a sun, clouds, grass, and flowers as an alternative to the doll and clothes. I store all the pieces in a Zip-loc bag inside the folder and it's ready to go!
I envisioned this turning out way cooler than it did, but Lillian helped with most of it and that made the project very fun no matter how it actually turned out!