Breaking down, killing and looting enemies and Scavenger skill are the best ways to farm upgrade Material.

Break Down

Instead of selling junk items that you don't need, you can Break Down them and get materials that can be used for upgrading items.

• Open Inventory and after going on the junk item hold the designated button for Break Down. (R in PC)

Scavenger Skill

In Abilities > Ranger > Level 5 there is a gathering skill with hand icon named Scavenger.

What this skill does is, whenever you pick up a herb, which there is a lot of them while doing quests and exploring, you have a chance to find upgrade material.

Looting Enemies

You may already know this and I'm just adding this here in case someone forgot that looting enemies after killing them will give you upgrade material.

• Because enemies don't respawn after you kill them, there is no good place for farming upgrade material from them.