Waterfalls come in all sizes and configurations, so you can really do almost anything here. But to help you focus a little, there are two main types of waterfalls: those with ponds below, and those without. Traditionally, waterfall-seeking homeowners have installed ponds in their yards, then topped them off with a decorative waterfall feature -- often a small stream of water cascading down a jumble of rocks. These types of ponds often feature pretty plantings and even colorful fish. While beautiful, such installations can be quite pricey and require a fair amount of maintenance, which is probably why pondless waterfalls eventually emerged.
With pondless waterfalls, water cascades down something -- rocks, for example, or a stone wall -- and onto a bed of ornamental gravel. The gravel covers a retaining basin that catches the water and a pump that sends it back up to the top of the waterfall. These are great options for those who don't have the space or desire for a pond, yet love the look and sound of a waterfall.