I use 3mm carton to make my boxes. To cover them elegantly the best material is bookbinders linen. This is nice and strong and comes in so many beautiful colours that the only real difficulty is choosing the color. Normally the color linen you choose should compliment the picture you have decided upon for the outside.
The inside can be covered with linen or with paper and is as important as the outside. I use handmade paper or two colours of linen depending on the effect that I want to achieve.
The paper that is used to decorate the outside should be of good thick quality. A great source for these images can be old calenders gathered from friends at the end of the year, or old books found at second hand markets. You could use old posters or even very good quality wrapping paper.
Of course if you feel confident enough you could use very expensive hand made paper but you should practice with some less expensive paper first or it could turn into a very expensive hobbie ! :)
