A great place to start your shopping is the
Spadina/Dundas area and then work your way to Queen West/Spadina
Kensington Market is just off of that and it has some great second hand thrift stores. Courage My Love was a favorite of mine when I used to live in Toronto. They used to sell scraps of leather and suede for a few bucks, great for small crafts or making leather thimbles
Spadina/Dundas is Chinatown
You can hop in and out of stores to find great little trinkets, exotic teas and other little finds. It spans blocks and blocks of little shops and a couple of malls. Second largest in North America.
A shop just on the corner of Nassau and Spadina I think called Y & K trading has a mish mash of stuff and some cool sheets of asian inspired paper (2x3 ft) for just $3
Head down Queen West for some really great fabric stores (it is the fashion district so be prepared to spend hours going into 20+ fabric stores.)
There are some really great thrift stores on Queen and some great independant stores that sell handmade clothing and acessories such as Preloved and Peach Berserk
Along the way you will hit Arton Beads on Queen Street just before Augusta Ave. They are not open on Sundays so make sure you go on any other day. They have the best prices I've ever seen and whenever I'm in town I only go there....
A few blocks away is a cute ribbon store called Mokuba. They sell all kinds of ribbon, like silk and organza it can be a bit pricey but definately worth dropping by.
The Japanese Paper Place is further up Queen (West) you can either walk up or take the streetcar but if you have time there are also some great little shops and antique stores along the way.
They sell all kinds of Japanese paper, origami and crafts.
I absolutely love this store! They have a sister store in Montreal but it doesn't compare to the main location in Toronto. They sell online but if you get an opportunity to see in person, go and check it out. You won't be disappointed.
Goodwill is located in various parts of the city. One of the main drop off centers also carries furniture and is 2 levels. They are located at Jarvis/Adelaide
Value Village is also located around the city for second hand finds
Here are the locations