You may encounter a stream or waterfall that makes a great shot with your camera's automatic settings. Chances are good that the camera will choose a relatively fast shutter speed to try to minimize blur from movement of the subject (or the camera from hand-holding,) which is approrpiate for the majority of situations.

In order to make the running water look smooth, you will need to choose a setting with a relatively slow shutter speed. Either set your aperture and shutter speed manually, or choose a shutter priority setting.

The slower the shutter speed, the blurrier the water will be, giving it that smooth, and sometimes milky look. Try a number of different shutter speeds and decide which shots look best when you get home from the shoot.

Always use a tripod when working with slow shutter speeds, as the jiggle from handholding will inevitably cause the stationary portions of the scene to blur as well.

The photograph above uses the default shutter speed with an automatic camera setting. The photographs below use manual settings or shutter priority with a long shutter speed to make the water appear smooth.