Set the base rocks in place within your landscaping. These rocks will likely be larger than the smaller ones that will go on top.
Use a chisel and hammer to remove corners and edges that prevent the rocks from sitting close to one another. This reshaping gives a rocks a more uniform appearance, as if they had settled within your landscaping as they do in nature.
Lift each rock carefully and, with a trowel, add about an inch of cement between them. Set the rocks back in place. Scrape away any cement that seeps out.
Start piling on the smaller rocks. Use varying sizes, shapes and colors to make the rock formation look more natural.
Continue chiseling chunks from the smaller rocks so that they fit nicely within the curves and grooves of the larger rocks and each other. Once you get a placement you like, add cement between the smaller rocks, as well, so that your new formation will stay in place.