I work on vellum a lot. You can get 8 1/2 x 11 sheets, and you can print on them. They're not as transparent as tracing paper, but pretty close and a lot heavier. It also isn't as absorbent as regular paper, so if you're working with markers it's easier to control shading and tones.
Step one was sketching out the geography. I knew it sat in a narrow spot in the mountains, with the valley opening up below it and two narrow valleys leading out above it. A river gorge partially bisects the town, and a stream provides drinking water & powers a few mills. I sketched out the buildings in pencil - the partially completed version was the first WIP post - and scanned it.
Frequent scanning is important. I can scan a map, clean it up, erase any mistakes I've made, and then print it out on vellum and keep going. If I goof, I reprint it from the last scanned version and try again.
I didn't want a grid on final version, so when the pencilwork was done, I taped a piece of vellum over it and started tracing. The version below shows the buildings and ridgelines, but none of the geography. Later tonight or tomorrow I'll do the geography, and then go through the town and add details.