Trace a circle about one foot in circumference on the plywood. Trace three 4-inch x12-inch rectangles on the plywood for the base. Cut out the pieces.
Stand the three rectangles in a triangle formation with the edges joined. Nail the pieces together. Make sure the nail goes all the way into the joining plywood.
Place the circle on top of the triangle base. Nail the circle onto the base.
Make the papier mache by mixing three cups of flour with 2.5 cups of water. Make more as needed.
Dip strips of wet newspaper into the mix one at a time. Cover the top and base with a thick layer of newspaper strips. Round out the top slightly by adding more papier mache until the top resembles the top of a mushroom. Let the chair dry completely.
Paint the chair with your main color. Use your secondary colors to add circles and ovals to the top of the chair to resemble a mushroom.
Embellish the chair around the mushroom cap with butterflies, flowers, leaves or fairy miniatures as desired.