A place to write - this can be a kitchen table, a kids play table or a desk. It is really preferable that this place "fits" the child -meaning that the chair isn't too big to fit in so that the child's legs dangle in the air -also meaning that the child isn't croching their back to get their body over the paper because the space is too small for them.
A place for books - I find that my teacher books take up as much, if not more, room than the kids books. A book shelf, multiple magazine racks, a desk that opens for books are all helpful tools. I've even known people who used rolling carts to keep their books on so that they're accessible while they're doing school, but out of the way when they're not. I've heard of families that store each child's books in bookbags in the closet. You still have to find a place for parent books.
A place for supplies - this is something that every homeschool mom I know battles for and salivates over. My craft supplies are always overflowing the space I have for them no matter how organized I attempt to be. I buy my kids each a pencil box to store their supplies. Some are more responsible with their own supplies than others.
Wall space - THIS IS NOT NECCESSARY and yet oh, so desirable. Wall space is great for a time line, posters or to display a child's work. This is also something that homeschool moms dream of at night.
Good lighting - a well placed lamp can take care of this. We've tried overhead spotlights (too much shadows over the paper they're working on, florescent (made me feel like I was in an institution rather than my home) and have settled on lamps.
My children do the majority of their school on the couch or on the floor. I try to insist on them writing at a table and they find ways to write neater while laying on the floor. It doesn't take a dedicated space (although for some families that is ideal), but really utilizing the space you have with your school needs in mind.
One of my favorite questions was "What does your ideal schoolroom look like?" Dreaming is so much fun!!!!!!