Wow you have already a lot of responses and I didn't take the time to read them all so I apologize if I repeat anything... but I suggest that you not take her to her room because that is her sleeping and possibly toy area. I would suggest that you find a corner, room or the bottom step of your stairs. They say you should only put them in time out for a minute every year of their age. Do you watch Super Nanny??? I swear with dedication this stuff works. At the age of 3 1/2 she should be coming out of her terrible two phase but every child is different. Here are my recommendations...
Praise and Rewards
The best rewards are attention, praise and love. Sweets, treats and toys are not necessary as rewards. A star chart or a special outing can back up a pattern of good behavior.
Consistency
Once you have made a rule, don't change it for the sake of a quiet life or because you're embarrassed. Make sure that everyone--which includes caregivers and your partner--keeps to the same rules as well. A rule is a rule is a rule.
Routine
Keep your home in basic order and maintain a routine. Set times for waking, meals, bath and bed are the cornerstones of family life. Once a routine is in place, you can be a little flexible, if you're on vacation, for example. It's a framework, but it doesn't have to be rigid.
Boundaries
Children need to know there are limits to their behavior--which means what is acceptable and what is not. You need to set rules and tell them what you expect.
Discipline
You can only keep the boundaries in place by discipline. This means firm and fair control. It may just take an authoritative voice and a warning to get the message across. Otherwise, there are other techniques you can use, none of which involve punishment.
Warnings
There are two kinds of warning. One tells a child what's coming next-- you're the Speaking Clock telling her that bathtime is coming up soon, or that you're getting near to putting her lunch on the table. The other is a warning for bad behavior. That gives her the chance to correct her behavior without any further discipline.
Explanations
A small child can't understand how you want him to behave unless you tell him. Show and tell to get the message across. Don't reason or make it too complicated--just state the obvious. When you are disciplining a child, explain why in a way that is appropriate for his age. Ask him if he understands the reason why he has been disciplined so that the message hits home.
Restraint
Keep cool. You're the parent and you're in charge. Don't answer a tantrum by a display of anger or respond to shouting by shouting back. You're the adult here. Don't let them wind you up.
Responsibility
Childhood is all about growing up. Let them. Allow them to do small, achievable things to boost their self-confidence and learn the necessary life and social skills. Get them involved in family life. But make sure your expectations are reasonable. Don't set them up for failure.
Relaxation
Quality time is important for everyone, including yourself. Let your child unwind at bedtime with a story and cuddles. Make sure you, your partner and your other kids have quality time for individual attention.