In most Chinese villages, mountains and water are essential resources for human life, which residents have established close connections with through subsistence and production activities. These connections involve geographical, functional, and spiritual effects, which create the unique cultural identity of a place. As a kind of rural heritage, rural industrial heritage is a concrete result of the interaction between local activities and mountains and water, thus presenting specific local characteristics. The conservation and re-use of rural heritage have become an important issue in global rural studies. Different cases that have been transformed and re-used are analyzed in this paper, in order to explore the influence of mountains and water on their local characteristics, the effects on their conservation and re-use in both spiritual and functional aspects, and suitable regeneration patterns based on local characteristics. Comparative analysis of 3D maps, diagrams, and literature materials indicate that: (1) mountains and water dominate rural industrial heritage geographical characteristics, including their layout, size, and form; (2) the direct or indirect supports of mountains and water, in terms of functional and spiritual aspects, have changed after regeneration, where spiritual supports are becoming increasingly important; and (3) regeneration patterns with different focuses represent new habitats combining natural and artificial landscapes, indicating new relationships that shift from the single utilization of mountain and water resources in the past to symbiosis and mutual benefits between residents, heritage, nature, and local communities in the modern context. © 2022 by the authors.