1. Spend some time at the Folktexts website. It’s a vast and amazing site, so don’t just spend 5 minutes at it. Really dig in to the extraordinary collection of material there.
2. After you’ve spent real time exploring the website, choose 1 folktale that you think would be interesting to play around with. Cut and paste it into a document.
3. Rewrite the folktale in a way that stays true to the spirit and the general direction of the story, but that makes it modern and expands its details. Flesh out the ideas and characters. Give it some dialogue. Change the point of view if you want (how would the tale work in 1st person, for instance?) Play around. See what happens.