The article highlights that in the space of modern design and artistic and creative education, in particular decorative and applied arts, the importance of paper is growing as both a creative material for modelling and for creating artistic products, and at the same time, the paper is simultaneously one of the most accessible art materials both from the viewpoint of ease of use and cost, and paper craft is an important basis for students' perception and creation of more complex artistic forms of professional art. It is noted that despite various editions, this disparity does not allow fully revealing paper-making as a conceptual whole – in the diversity of its connections with project culture, creative laboratory and design methodology in design. The purpose of the article is to reveal paper-making in the space of decorative and applied arts as well as to identify its theoretical and methodological foundations and to substantiate the role of paper-making in modern design for the formation of students' creative thinking alongside the formation of their artistic and pedagogical skills. These methods were applied and used to reveal the problem: general scientific (analysis, synthesis, generalization, systematization); scientific and specific: historical, artistic, pedagogical, psychological and approaches: systemic-structural, structural-functional, comparative, with the help of which the opinion regarding the phenomenon of paper-making is generalized, its essential content is clarified in the plane of decorative and applied arts, in modern design, and methodical methods are specified principles to the problem regarding the development of creative thinking of students specialized in artistic and pedagogical mastery. In the main content, it is noted that on the basis of methodological provisions and basic principles of traditional craftsmanship, the creative and essential foundations for decorative and applied arts are manifested, which ensures the formation of components of artistic competence and, at the same time, requires the use of students’ creative and figurative thinking. The idea of the key figurative-essential basis for paper-making is provided and it is noted that mastering the specifics of artistic imagery forms students' aesthetic ideas as well as a valuable act of understanding the world. It is highlighted that "paper plastic" also reflects the specificity of the author's approach to the study of compositional, constructive, structural and technological regularities of the work with material. In the content of the Methodological recommendations for conducting practical lessons, it is emphasized that the result should reflect the student's mastery – from the initial sketch through full-scale sketches to the design of the idea in the material. It is justified that in addition to the traditional methodical principles of education, there is a need to use certain art technologies. It is emphasized that the implementation of the developed "Conceptual Technology" in the teaching space of paper-making contributed to the decision-making process regarding the means of creating an artistic image. In the conclusions, it is noted that paper-making as a type of activity occupies an intermediate position between learning and playing and meets the conditions that ensure the effectiveness of the development of creative activity. Learning and practical work in the technique of papier-mâché using papier-mâché is important for the formation and development of abstract, associative, combinatorial, logical thinking, in the process of learning "paper-mâché" the creative thinking of students is formed and the skills of stylization and generalization are acquired, which involves the acquisition of practical experience for figurative reproduction. In the perspective of further research, it is important to consider the need to research, develop and create a model for the development of the future designer’s artistic and creative competence.