Hand stitching is a great beginning sewing skill to teach little ones and the bonus is that it's also the perfect quiet time activity! To start, I like to stretch burlap over embroidery hoops to make an easy canvas for practicing their stitches. For needles, I get the blunt tip ones so no one pokes themselves, the size 30 cross stitch needles worked well. They have just enough of a point to get through loosely woven fabrics like linen, but are rounded enough they're good for kids.
SEWING PRACTICE FOR KIDS
wooden embroidery hoops (I like the smaller ones for toddlers!)
fabric (I've used cheesecloth, burlap, linen)
cotton thread/embroidery floss
cross stitch needles
scissors
Once I set the fabric in their embroidery hoops, I showed them how to thread the floss through their needles, and then tied a knot in the end of their string to hold it once they started threading it. They picked up hand stitching fairly easily, and the more they've practiced the smaller and more precise their stitches have become. It's a great way for them to have quiet time and focus a bit on their creativity!