Here's how to do it. First, a basic batch of soap is made and at least partially cured. A good choice to use is the first one in the Recipes section called Basic Soap. It's virtually foolproof and works very well in hand-milled soaps. Assume we have already made the Basic Soap recipe and it's ready for milling.
Some folks use their food processor which is OK too.
If you're grating soap that is still moist, wear rubber gloves as it will still contain some lye. Grate soap over a protected surface, not newspaper or it will absorb the ink. If you turn the heat up high and rush the melting, you might end up with an unusable mess. Stir melting soap and water together gently with a wooden spoon being careful not to make bubbles. If you see them forming, quit stirring for a bit.