I've seen this project in many places but decided to give it a try.

Supplies used:
4" x 4" tiles
scrapbook paper
mod podge
1 inch foam brush
sheet of felt

My tiles are 4" x 4" so I started by cutting my paper into 3.75" x 3.75" squares.

Apply a later of Mod Podge on the face of the tile.

Center the paper in the middle and coat with one layer of Mod Podge.  Allow this layer to dry for 15 minutes and do a second coat.  My first layer went west to east and my second layer went north to south.  This creates a grid looking pattern when the Mod Podge dries.

I wanted to make sure my tiles were really sealed and waterproof.  I had some Polycrylic in my stash and gave the tiles one coat.  It also gives the tile a shine.

After the tiles dried, I applied a 3.75" x 3.75" piece of felt to the back of each tile with glue.  Don't want to scratch up my table.

Now I have some decorative coasters that match my color scheme.  I could easily do another set to match the room if it changes (not likely right?).  These would also be good gifts.

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