In a small pot bring the water, milk, and salt to a gentle boil.
Slowly stir the grits into the boiling mixture. Stir continuously and thoroughly until grits are well mixed.
Let the pot return to a boil and cover with a lid, then set the heat on low and cook for approximately 30 minutes, stirring occasionally. Add more water if it looks like it's drying out.
Grits are done when they have the consistency of smooth cream of wheat. Stir in the butter and serve.