I started with this smooth rock that I happened to find in our driveway.
When drilling and engraving rocks and stones, keep a container of water at hand. Frequently dip the rock into the water to rinse away drilling debris and to cool the rock. Here's my set up:
I hold the engraver in my right hand and the rock in my left, with the rock supported on a towel. The towel absorbs excess water from the frequent dippings and provides a cushioned surface to work on.
You can draw your design on the rock with a pencil or freehand it. For this simple design, I chose to freehand it. Slow and steady is the key. The power of the engraver comes from the rotation of the bits, not from undue pressure. I used the corundum grinding bit that came with my engraving set. Corundum is second only to the diamond on the Mohs scale of mineral hardness. Even so, it does take patience to carve all the way through a rock.
This stone was about 1/4" to 3/8" thick, and it took me around eight minutes of drip in the water/drill, drip in the water/drill, and repeat to complete the top hanging hole. The three shallow holes will seat crystals—it just wouldn't be "me" without a bit of bling :)
With the drilling and engraving complete, I polished the stone with beeswax, using my Proxxon Profession Rotary Tool with a buffing wheel, (Note: You can also use the rotary tool with appropriate bits to engrave and carve rocks.)
After the buffing, I used E6000 adhesive to set the crystals. Notice that I use a precision tip to dispense the tiny amounts of glue needed.
I'm quite pleased with my engraved river rock, and will be on the lookout for more appropriate stones to engrave and carve.