It flows south for a short distance before turning southwest and passing through Jerseytown, where it crosses Pennsylvania Route 44.

It then crosses Pennsylvania Route 54 and enters Chillisquaque Creek 16.79 miles (27.02 km) upstream of its mouth, immediately south of Washingtonville.

[3][4] As of 2011, a total of 54.78 miles (88.16 km) of streams in the watershed of Mud Creek were affected by organic enrichment, low concentrations of dissolved oxygen, and heavy loads of sediment.

The entirety of every stream in the creek's watershed was considered by the Pennsylvania Department of Environmental Protection to be impaired as of 2011.

The largest contributor of sediment to the creek was cropland, which contributed 19,538.46 pounds (8,862.50 kg) per day.

[5] A United States Geological Survey report from the 1960s observed a total of 1.5 tons of dissolved solids flowing through the creek daily.

An average of 0.14 pounds (64 g) per day of phosphorus came from land classified by the Pennsylvania Department of Environmental Protection as "transition".

[7] A United States Geological Survey report in the 1960s measured the concentration of bicarbonate in Mud Creek to range from 41 to 109 milligrams per liter, but there were no carbonates in the water.

The watershed of Mud Creek is in the ridge and valley physiographic region of the Appalachian Mountains.

The Trimmers Rock Formation occurs on the southern side of the watershed and also in the northeastern corner of it.

[5] The Lower Helderberg Limestone occurs a small distance north of Mud Creek, where it is quarried.

The Chenango-Pope-Holly occupies areas near the creek itself in its lower reaches and the Berks-Weikert-Bedington series occurs throughout most of the southern edge of the watershed.

[12] On average, 44.5 inches (113 cm) of precipitation fall in the watershed of Mud Creek annually.

The watershed of the creek is in the Washingtonville and Millville United States Geological Survey 7.5 minute quadrangles.

Most of the forested land is on the watershed's southern and eastern edges, but there are some patches of it elsewhere, most of which are fairly small.

[5] An early settler in the area was George Whitmoyer, who built a cabin in the valley of Mud Creek at Jerseytown in 1772.

[5] However, the Montour County Natural Areas Inventory has recommended restoring the riparian buffers in Derry Township.

Plant types typically found in wet meadows include various ferns, sedges, grasses, and red maples.