He became a probationer in 1842 and, after studying at Richmond Theological College, he was ordained in the Methodist chapel, Spitalfields.
On 13 August 1847 Waterhouse married Maria Augusta, née Bode, at Windsor, Berkshire.
In 1847, Waterhouse returned to Van Diemen's Land and during the following eight years was appointed to the Hobart, Westbury, Campbell Town and Longford circuits.
After transferring to New South Wales in 1864, Waterhouse served in Maitland, Goulburn, Orange, Waverley, Parramatta, Newcastle and Glebe.
Waterhouse's ministry was supported by his sound financial expertise and he was noted as a gifted preacher within his church.