It usually occurs when the artwork file is moved, so the puppet points the wrong path name. If you select the puppet, one of the first properties is the path to the artwork. If the path is orange, it means the file could not be read. Click on it to locate the file in its new location.
That happens when the project is moved (or the artwork is moved). Single click on the puppet in the project panel. The first "property" over on the right should be "Path". Click on that and re-open the artwork file with the correct path for the PSD/AI file.
Here is a recent similar problem. Puppet looks like a test pattern If you look at the top right corner of the screenshot you can just see the orange path name to the puppet. Once that was fixed it started working again.
It usually occurs when the artwork file is moved, so the puppet points the wrong path name. If you select the puppet, one of the first properties is the path to the artwork. If the path is orange, it means the file could not be read. Click on it to locate the file in its new location.