Pair up your students and give each team a set of dice or number cubes (dice with numbers on the sides instead of dots). Have one of the students roll the cubes and write down a two-digit number using each of the two values on the cubes. Either number may be used in either the tens or ones position. Have the other student repeat the process and choose the number that is smaller than the first. After they have written down the second number, have them discuss whether or not they would need to use regrouping to solve the problem and why. Then have them solve it.
The website Dositey provides free Flash-based and Java-based educational browser games for students. One of the games walks students through the regrouping process by displaying simple subtraction problems on the sides of trains. An animated hand points to what the student needs to do next to solve the problem, and a text bubble tells them why. Once the student has completed a problem successfully, the train moves on and another takes its place.
Separate your students into groups and designate one of them as the banker. Give the banker a handful of pennies and everyone else five dimes. Have the students take turns rolling a die. The goal is to get rid of all their money, but they can only get rid of the number of cents corresponding to the value they roll. Since they only have dimes, they will have to exchange them for pennies from the banker to accomplish this. Once they have gone through a few rounds, they will have both pennies and dimes, and they will have to determine when they have to "regroup" and when they do not have to.
Fill plastic Easter eggs or other small containers with 10 jelly beans. Write out a subtraction problem that requires regrouping. Have students organize the containers and loose jelly beans to create the top number (42, for example, would be four containers of beans and two loose beans). Then have them subtract the second number from the beans. They will find that they have to "borrow" one of the containers and open it to have enough jelly beans in the ones column.