Pan Chakki literary means water mill is one of the major attraction of Aurangabad. This 17th century water mill, built by Malik Ambar, draws water from a spring on a distant hill at a distance of 6kms away through underground earthen pipes. Masonary pillars are erected for the flowing of water through pumps. Water flows through the pipes and it is raised by a siphon to the top of the huge raised masonary pillar and from there it falls to make an attractive water fall. The huge banyan tree on the southern side of the reservoir provides shade to the pilgrims. Panchakki takes its name from the water mill which was considered a marvel of engineering at that time.

An attractive landscape garden and a fish tank with fountain has added charm to the entire area of Panchakki. The place also has a tomb of a Muslim Sufi Saint Baba Shah Muzaffar who had gathered to India in 12th century A.D. and was a spiritual adviser to Aurangzeb.