Draw a basic house shape next to a stream of water. Water was often used to power grist mills. Use a picture of an actual water mill as a reference, if desired.
Draw a circle that reaches from the eave of the building to slightly below the water line. Draw a second circle the same size as the first in front and slightly off-center from it.
Draw lines reaching from the edge of the front circle to the back circle. Draw lines parallel to those lines, and sketch in board edges.
Draw thin streams of water dripping from the edges of the boards, into the stream. Draw a dam behind the water wheel, and use flowing lines beneath the wheel to indicate water movement. Finish the mill pond and edges of the mill stream with bushes, grass and wildflowers. Weeping willows also make an attractive addition to the mill stream landscape.
Draw a wooden waterway from the mill pond dam to make an over-shot water wheel; let the water flow underneath the wheel to show an under-shot water wheel.