I was recently asked about where I find my fabric-by a few people, actually. My stash as a whole comprises of a lot of different sources. I do have some standard finds that I buy with coupons or on sale at fabric stores. I love remnants. I see them as a challenge..."what can I do with 43/47ths of a yard?..."
One source that is not renewable was my husband's grandmother's stash. She had three closets and a WHOLE room in the basement to house hers. I picked through a lot of it and kept the handy/pretty things. There was a lot I would never use (or thought at the time as I had yet to discover rug making...) like double knit polyester. That being said, thought, she got me started on my vintage material collection.
I augment that part of my stash with finds at flea markets and antique stores. I think I get pretty lucky with this, as I do not exactly see fabric all the time, but I buy up just about all I can afford when I do. I love prints from the first half of the 20th century. I have a couple right now I just keep picking up and staring at, trying to decide what they would be perfect for. It's hard, as this will most likely be my last chance with that print, as finding it in the first place was pretty awesome.
Another source is thrift stores. Now, you can often find yarn and crafting goodies, including raw fabric, at thrift stores. Where I look, though, is in the housewares/bedding section. I have gotten some terribly pretty sheets that made beautiful curtains or skirts there, as well as funky retro ones that made great stuff for clothes.
Garage sales also have great opportunities for both fabric and things like sheets.
For kids, do not look past adult clothing, as well. There are really cute things you can make out of adults clothes. Some prints on adults don't look so hot, but on a 2 year little guy or a 4 year old chica, they look absolutely adorable. There are tons of tutes online for changing grownup things into little people things. I throw away NONE of our clothing, save larger men's clothing, which gets sent to Hope Ministries. Even holey socks can be used to stuff toys and pillows later. Or that dog puke you don't wanna touch-yeah, I use an old sock and just toss it when I'm done.
I think that sums up my sources. There is a lot out there if you just look. It is not a drive to the store and find something now sort of deal, but I definitely think the hunt is what I enjoy the most-even more than using the stuff ;)