This weekend Toys R Us was doing a craft at the store and it was the new rubber band loom kits to make bracelets. My daughter (age 2) was way too young. Even the simplest pattern took a lot of coordination and careful following of directions. But I made her one while she played with the rubber bands and she loves the bracelet.
This is a great gift though for an older child (5-8). It's small (just a plastic peg loom and rubber bands) and apparently are pretty popular. It sounded like the other little girls were talking about learning new patterns and using different kits of colors.