Conventional seals consist of a stuffing box into which are laid several layers of grease-impregnated packing specifically made for the purpose. The box is closed by tightening the bolts in the outer flange. This compresses the packing, causing it to seal against the shaft.
The flange needs to be tightened just enough to stop leaks. If you overtighten the bolts, the result will be heat and wear on the shaft, possibly causing twisting and failure of the rubber sleeve which connects it to the stern tube.
The flange should be retightened as soon as a leak is seen. If leaks are persistent change the packing. Some stuffing boxes have external greasers so that grease can be injected after or during use.
Rubber lip seals are also used, similar to those in the engine, to seal in oil around a shaft, but made from a material compatible with water.
Face seals are becoming increasingly popular. They work by mating a precisely ground stainless steel face against a carbon face. Rubber gaiters hose-clipped to their respective shaft and stern tube both provide flexibility and spring the faces together.
Face seals may need special lubrication procedures during launch and initial start up, so refer to the manufacturers for instructions.