Step 1: Obtain Parts
Large Green Baseplate Lego Site
Minifigures: when I purchased these, there was a special for 4 random minifigures for a couple of dollars, I think. Obviously, optional.
The following parts were ordered from Lego's Pick-A-Brick site:
To find these parts, enter text between single quotes into Brick Name field on Pick-A-Brick.
'Plate 1X1' (many, assorted colors)
Quantity 1: 'Plate 1X8' (hour hand)
Quantity 1: 'Plate 1X12' (minute hand)
Quantity 1: 'Clamp 1X2' (handle for figure to hold on to)
Quantity 4: 'Plate 2X2 Angle' (stands for figures)
As far as number of the Plate 1x1, I took a guess. Most of the colors I ordered 12, but since there weren't 12 different colors, on some I ordered 30 just to be safe. As you can see, the 2 took 14 of these plates, while the 1 takes 6. Of course, you don't have to use 1X1 plates, you can mix and match sizes and shapes, but I didn't want to get that complex.
This is a very basic quartz clock movement. It should be available at hobby or craft stores, as well as many sources online. If you pay more than $10, it's probably too much. The one I bought was number 10002 from Klockit.com. It came with free hands which I did not use, but they were nice for sizing the holes in the Lego hands.