。
She gathered up pretty stones.
Literal
She [topic-は] pretty stones [object-を] picked-up-and-collected.
拾い集める is a productive compound verb: 拾う ('pick up') + 集める ('collect, gather'). The combination creates 'pick up and collect, gather by picking up' — the picking-up aspect is the manner, the collecting is the result. Compound verbs of the V1+V2 type are central to Japanese vocabulary, with the second verb often acting as a manner-or-direction modifier on the first. Other 集める compounds: 寄せ集める (gather together, 'pull and collect'), 駆り集める (round up, 'drive and collect'), 取り集める (collect by gathering).