One of my favorite Christmas memories as a child was watching and staring at my Uncle Durwood's Christmas tree. He had a train going around it and inside the track were figurines and scenic nick knacks they had bought on vacations and other travels. I loved that tree, and I vowed to have one of my own someday.
My first Christmas out on my own I bought a train and a tree and set it up....and it looked pitiful. But I started collecting buildings and figurines and it was only a few years before I had a Christmas Village that I was proud of and that has become a tradition in my family.
Step 1: Village Base
My Village base is made of pressed wood. I'm not sure a base is absolutely necessary, but I do think it gives a stable base to the train tracks and provides the means to get electrical chords out of the way.
My board is just a standard sheet from the home improvement store, which happened to perfectly fit the space I wanted. You might need to make it smaller to fit your space.