Probably using a Plaster of Paris, mix it up as usual, add some paint for color, maybe some sand, small rocks, static grass, small sticks for filler, and you make mud.
I prefer to use a ready made product from Vallejo, their Earth Effects series, comes in a 200ml tub in 3 colors, which can be mixed together to create other colors, as well as mixed with their paint, pigments, etc, etc. It has a natural sandy grit to it already, but you can add other stuff to it to bulk it up.
It is what I used on my M-103 for mud. Mixed 2 colors together to make the shade I wanted, added static grass in different lengths, some medium railroad ballast for larger chunks, and then spread on. Best part is, it is water based, so if it starts to dry out in the cup, you can just add some water to it to rehydrate, as well if you over hydrate slightly, it makes a great medium to do mud splatter effects with an airbrush. Just load a paint brush up and then hold it in front of your air stream from your airbrush.
They run about $14-15 a bottle, which may seem like alot, but you don't need very much to do a tank, especially when you add some other fillers like rocks and grass to it.
http://www.elmcityhobbies.com/shop/index.php?main_page=product_info&cPath=56_62&products_id=1591
http://www.elmcityhobbies.com/shop/index.php?main_page=product_info&cPath=56_62&products_id=1592
http://www.elmcityhobbies.com/shop/index.php?main_page=product_info&cPath=56_62&products_id=1593
Here is what it looks like on a board spread out, with just some tank tracks and wheel marks run through it.
