(courtesy of the Lake Oswego Oregon Stake, as shared by Bobbie Poppleton)
Materials: chalk (colored is great!)
As you tell a story or read a scripture related to the lesson, draw pictures on the chalkboard to illustrate. Stick figures are fine. If you put expressions on the faces it'll entertain the kids. You could even draw dialogue bubbles (show what the people are saying in modern terms)
Give the chalk to a member of the class. Have the student illustrate the story or scripture. The chalk could be rotated to different members of the class.