After beating the gym leader, walk out of the gym. After coming out of the gym go right and then down the big flight of stairs. After coming down the stairs go left, until you reach the sign, then go up. You should see a girl standing on what looks like a beach. She will give you HM7 Waterfall.
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you do need hm waterfall for mt. conet.There's a waterfall in mt.conet
U don't go through the waterfall, u go over the waterfall. The goal is to have the HM waterfall. This HM allows ur Pokemon to climb the waterfall.
To my knowledge i don't think there is a waterfall in Pokemon yellow and it is quite irrelevant to the storline if there was one. If you mean a HM named waterfall...i think your on the wrong game, only pearl and diamond have waterfall HM...i think. There are only 5 HM's in Pokemon Yellow Flash, Cut, Fly, Surf, Strength.
You have to surf north of sunyshore city and use the hm waterfall when you get to the waterfall.
After beating the last gym leader go to the north side of sunyshore and a girl will be there and after talking to her you get waterfall