Beijing, like the rest of China, has everything you could possibly be looking for. From designer duds to fabulous fakes, Beijing has you covered. A great place to start out is the Hongqiao Market. Known as the "Pearl Market," it's here on the 3rd floor that you can find real pearls, dirt-cheap. The 2nd floor has your usual assortment of fakes, and the 1st floor hawks your everyday needs like batteries, nail clippers, etc.
The Panjiayuan "Dirt" Market is another must, but be sure to get there early as a lot of vendors pack up around noon. Here you can find all sorts of "antiques" and trinkets. This market literally has any kind of curio you could be looking for. Be careful, you need to bargain hard and a lot of the "antiques" are reproductions.
If you are looking more for porcelain or art, Liulichang is the spot for you. Built in the style of "Olde Beijing" teahouses, it captures the feel of pre-communist China. Browse the antique stores and art galleries, then stop for a cup of tea and enjoy the scenery. Just past Liulichang is Qianmen St. which is a bit more crude and rustic than the other markets you will see. But it is here that you can find Cultural Revolution propaganda, silk screens, Ming furniture, and antique books. This is great if you like to dig to find that gem.