I am not an expert and have learned how to do this mostly by trial and error, and a little advise from some rock hounds.
The technic I use depends on the type of stone I am carving. Soft stone like sandstone or soapstone I use any type of blade, such as an exacto knife. Harder stones like petrified wood, agate or jasper I use a flex shaft grinder with diamond bits. When using a powered tool like the flex shaft grinder I keep the stone wet, to avoid blistering the stone and damaging the diamond bit. I polish the hard stone pieces by hand using different grits of sand paper, starting with a heavy grit and working to a finer grit. I keep the stone wet whiling doing this to avoid blistering the stone. I use sand paper that is made to get wet, so that the sand paper doesn't fall apart.
If you know more than me please tell me I always want to know more and maybe you have/know a better way.
