An altar is a space dedicated to the God and Goddess of the Wiccan. It is a place where witches can respect their belief, celebrate the year feasts and perform rituals or spells.
An altar can be set up in any way you want, but here is an example to guide you if you need some starting points.
First of all you need a space to name your altar. This can be erected and dissembled if you are still in the 'broom closet'. For those who are public witches (or at least with family) you can make a permanent altar. Some good possibilities as altars can be a cloth (in any color you want; see the color correspondences in the correspondence chart), a desktop a silver dining plate or anything else you would like to put your religious articles on.
Secondly an altar usually consists of four quarters; the North, East, South and West. Some witches physically divide their quarters by placing sand, rocks or threads. All quarters are represented by a physical form of them. For example the North (earth) can be a crystal for rituals or a dish holding salt whilst the South (fire or air) can hold an athame in ritual or a candle for daily use. Fire or air can be divided into two quarters and it is important for you to find out what you are comfortable with. Some find that the South stands for male energy and is best represented by an athame whilst others feel the South is more connected to the male wand. It's up to you to decide!
To continue, the East can be thus athame or wand and the last one can be daily represented by incense. The West is dedicated to water and can have a chalice (sometimes a cauldron) of water to represent it. Just to correspond the quarters to the traits in life; Earth is for stability and money, the East is for wisdom, the South for passion and creativity and the West for human emotion (see the element chart). You can pick anything which feels right to represent the quarters instead of, or at the same time as, the objects I described above.
A very important part of your altar is the middle, also known as Akasha (Spirit). This is the mother Goddess and holds all energy, so that's why she's usually presented in the form of a kettle or an object with a pentacle/pentagram on it. In this you can burn your incense or make your potions as she is the creator of the Spirit and transforms normal earthly objects into something spiritual. Something which is also possible is to put an object in the middle which represents you as a Wiccan. Maybe a picture or a doll you liked when you were younger, or anything with emotional value for you. It usually help to look back at your youth as many spiritual messages come through more easily when you are younger.
Here's an example of an altar using the descriptions above. The inner images (crystal, incense, candle and vile) can be consistent on the altar whilst the other outside tools (salt dish, wand, athame and chalice) are usually only used in rituals. The center Akasha, containing the cauldron, can be both. The candles represent the God and Goddess (see text below).
Another important thing are your God and Goddess familiars. If you don't have a special connection (yet) to a deity you can place a white candle as your Goddess and a black one as your God. If you, in time, find a statue embodying one of the two deities you can always replace or put them in front of the candles. If you don't want physical embodiments of your God(dess) you can place any object there which connects you most to them. For example, if you worship a Water deity of the Sea (like Mari) you can put a shell on your altar to represent her.
Some witches have a pentacle as their altar symbol. This meaning they don't divide it into quarters but into the five pointed star. For the meanings see the picture below:
For these quarters all the same representatives can be applied as the ones described above.
It's most important to collect the items yourself which you have found as they hold your energy best, and in turn show how much you are connected to Wicca.
The altar can be decorated according to the seasons and thus the sabbats or esbats. For this you can just go outside and collect things for nature from the outside to place on your altar. For example in autumn you can put some dried fruits, milk, nuts or fallen brown leaves on your altar to respect Lughnadsad or Mabon.
For rituals some object, which were facultative before, have to be present (see picture above). In this scenario we are talking about the Northern Salt, the Eastern Wand or Athame, the Southern Wand or Athame (so the one for East cannot be the same as the one for the South), and the Western Chalice. The Akasha symbol is usually the person you do the magick on represented by a photograph or something which he/she had close connections to or the purpose of the spell (in case you are doing a spell for yourself it can be yourself in the middle of your circle, a picture of yourself on the altar, or a symbol representing the need for the spell).
If you need to hide your things from nosy outsiders choose an effective box in which you can fit all of your things. To keep the tools 'clean' (as in from negative energies from outside) wrap them individually, or wrap around the box a black (absorbs all) or white (reflects all) cloth.
*From Bewitching Ways*