Styrofoam is a great product to use for making hills. It's light weight, readily available, easy to form and, with a bit of scrounging around, free! I collect pieces from packaging materials. Computers and related equipment, TVs, etc., are loaded with the stuff. I've been picky and just keeping the stuff I want and I've got large boxes full. I was also at the local party and display supply store today, they had HUGE pieces of foam for sale. You can also find it at model RR shops, since it is commonly used for the same reason. Simply stack sheets or blocks in the general shape desired. It can be cut with a razor saw or they even make special hot-wire cutters, also available from RR shops. Glue blocks together with white glue only, since all solvent based glues will melt it. Cover the contours with either paper-mache, celluclay or my personal favorite, plaster bandage, available at craft stores, RR shops, medical supply stores, maybe even Mall-Wort.
I like the plaster bandage for one reason, it's quick. Paper-mache and celluclay take weeks to throughly dry, plaster bandage is hard within minutes. After the bandage is in place, cover the bandage with a thin layer of plaster of paris, celluclay or spackle paste and sculpt out terrain features like rock outcrops, gulleys or whatever. Paint with tempera paint (it's cheap) when dry.