This document outlines the 7 main steps to delineate a watershed from a DEM using ArcGIS:
1) Create a DEM from SRTM data and reproject it to UTM.
2) Remove sinks and errors from the DEM using the Fill tool.
3) Generate a flow direction raster using the Flow Direction tool.
4) Generate a flow accumulation raster using the Flow Accumulation tool.
5) Map stream channels by selecting cells with over 400 upstream cells.
6) Assign each stream segment a unique number using the Stream Link tool.
7) Generate the watershed boundaries using the Watershed tool.