A alter is pretty much a place were you can, preform some spells, honor your god/dess, and preform rituals.
How to make a alter.
Well I would suggest finding a clear table (preferrably rectangled, but you could use a round table if you wish). The cloth you place on it is traditionally white or black. What you usually would find on a alter, is a set of candles, some other stuff that they person thinks should be on his/her alter.
First all things of the craft are adaptable to that which fits you and best expands and enhances your personal energy for any work. Thus an alter can be placed anywhere, made out of anything, laid out in any way, or you don't have to use one at all. That being said you can convert any house hold item into an alter. Proper concacration and stuff is recommended to give it a spiritual feel and energy. Also keep safty in mind especially if you are going to be using anything flammable like wood or whatever. You can use a stone in your back yard or you can use and old tree stump if you want more of a nature feel to your alter.
As mentioned an altar is a table. Some people make one specifically for magickal purposes, out of wood or stone with certain magickal properties, but most use a table that's in the room, cleanse it, and set up their altar upon it. This could be a coffee table, a dinner table, a nightstand, I use to use a small filing cabenet with wheels. Once you have your table, you decorate it as you see fit, since different traditions, holidays, even seasons, can change how a person would set up their altar. Commonly, get an altar cloth [table cloth used only for rituals] candles, and whatever you will be needing in the circle. Statues of your deities is a good idea, but many use candles to represent them. The altar shouldn't be too big, just go with your gut as to what should be on it. If it was a perminant altar then I would invest in statues and things, but if you need one for your Sabbats and Esbats, a side table with a candle and your Athame is fine. Don't run out and buy a ton of stuff, pick up one at a time as its needed. Most of the tools can be made anyway.