Your local UPS store accepts packing peanuts. They are grateful to take peanuts as it saves UPS money and they recycle the peanuts for other shipment padding.
If you want a clever way to utilize the Styrofoam peanuts, you might consider recycled art. Recycled art is an eco-friendly way to take various forms of trash and turn them into cherished belongings. Given some time, and an artistic eye, you could create a sculpture or a textured painting with the Styrofoam peanuts. Another interesting field would be recycled fashion where people turn trash into clothing. I believe that the peanuts would be both a comfortable substitute for cloth or a great insulator.
Boycott styrofoam completely. Use old newspapers or old pillow stuffing instead!
Personally, I think you should use them for pranks!
Giving them to UPS or your local post office is the most practical use. Earth911 is a good resource for seeking out other recyclers.
There is also the option of melting them down (preferably outside or in a well-ventilated interior) with limonene to make super glue. The only downside is that I can only find two stores (both online) that sell it, and I do not know how good their reputation is.
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