Popsci has a quick how-to on building theremin-esque device for under 20 bucks –
A full-fledged Theremin will set you back nearly $400, but with the instructions below, you can build a pocket-sized Theremin-like instrument that won’t break the bank. Unlike the real McCoy which relies on grounded variable capacitance for changing frequency and volume with the wave of a hand, our Pocket Theremin uses variations in light for producing its unearthly vibrato.
Interesting choice of enclosure – Build a Pocket Theremin on the Cheap
HOW TO – Make a Theremin