Here is a fun way I taught my daughter to read three-digit numbers...
Sunday, on our walk home after church, we went on a three-digit scavenger hunt.
Prior to this, she knew how to read two-digit numbers. On our hunt, I introduced the concept of place value, and she quickly got the hang of it.
We took turns spotting three-digit numbers, and then I would ask my daughter what digit was in the hundreds place, what digit was in the tens place, and what digit was in the ones place.
Next, I told her to cover up the first digit (the digit in the hundreds place). For example, in the above photo, she covered the 1 in 132. Then, I asked what number she had. She said, "Thirty-two." Finally, I told her to uncover the digit in the hundreds place and say the digit followed by "hundred."
We did this at every three-digit number we encountered for a mile. By the time we got home, she was a pro! I'm looking forward to trying this again with four-digit numbers. :)