Ok well my girlfriend actually got it at auction and she drove it back she said it ran great and stuff. Then her son ran into a cement bench with it so they got the crossmember fixed and then it sat. the mechanic said it needed valve cover gaskets. I didnt know her at the time. So I hope thats all it is but then again how could water get in the oil. Unless its got a blown head gasket. What all do I need to replace the head gasket?

Parts
 

Minimum would be a gasket set for a head job which you can get from toyota
but I'd go a metal gasket for the head scince it has to come off and ARP head bolts scince they can be torqued more than the standard toyo ones, new plugs (iridiums), wires timing belt scince it also has to come off, new hoses for the rad, new heater hoses, check the plug on the back of the block,
if that goes your water goes out in a few seconds and the temp guage probably won't catch it,(no water or steam left to make the guage go up),
clean all your intake manifold parts including the ISV and while the manifold is apart check all the mating surfaces for warpage(TSRM shows you how to do this), clean the injectors, change oil and filter and again within a week cause of the water, flush and clean cooling system, clean the valves and piston tops and probably other stuff that I missed. The gasket set should have every gasket for the upper half of the engine and a water pump gasket. For sure change the injector seals which are also in the kit.
Its complicated and best left to pros who have Supra experience unless your a good mechanic yourself and have the time and the tools.

i will have to do it myself. I couldnt even imagine how much it would cost to have a mechanic do it. I have a lot of experience but mostly with old domestics. I had a 89 accord that i put a head gasket on and changed out the tranny and a few other minor things and I rebuilt the izusu motor in my LUV but other than that I havent worked on any imports. I will probably be on here a lot during this process. I just took the intake and valve covers off. The bolts wernt even tight on the valve covers. There is white gunk (water) all in there. not good. How much do you guys usually see the head gasket kit for? Plus bolts. I priced them at autozone, kragen and rebies and they ran from 150-350 i almost shit my pants. Thanks again for the help.

Ok I have it all torn apart except the head. For the head bolts is there a certain socket I need? None of mine will fit down in there. Also what about the cams. How do they come out? I took the timing belt off (the hard way) not thinking about trying to take off the cam gear. Does it hurt the motor to turn one cam and not the other? First time I have worked on a DOHC motor. Have I got in over my head? Well im there now so i ask for your help. Also in the middle of the head there are allen style bolts i have the wrench for them but what are they? Thanks again guys for helpin me out. I cant wait to get this thing on the road. I have never even got to drive it yet.

Just damaged valve cover gaskets. Mine has the same problem. As for the missing, try changing the plugs while you're changing the gaskets. Worked for me! (Should be $20 for the gaskets, $15 for the plugs, just about) Note, a mechanic should be able to do this for $120, parts included.

I already have it stripped down to the head. I might as well just replace the head gasket. and everything else lol.

Allen bolts
 

The allen bolts Are your head bolts, they are 10mm so you will need a 10mm 3/8 drive and maybe two short extentions or one at least 6" to go with the torque wrench. The procedures for taking the head off can be found here.
http://groundsky.co.nz/techinfo/TSRM/03_EM.pdf
page EM-32.
I re-torqued my head bolts last week and had to hook my battery back up and crank the engine a couple of times because the cams were interfering with some of the bolts.
The 7M engines are supposed to be non interfering engines so turning one cam at a time shouldn't be a problem.

I cant open that. I got the haynes manual. But i didnt see any specific instructions for taking them off. I have the allen wrench but what about the bolts down below the cams. I think they are holding the cams to the head. Do i need to take those off? Not the caps.

Hah! i just did that 2 months ago, have all the parts it took! You in the bay? 1 crtitcal thing you need to to do is.......replace every hose you take off, it wont even cost that much, and it good you good piece of mind. I didnt do this and now, 2 months later i've replace about 6 coolant lines that have decided to leak or blow. *head is very very heavy*(theres also a coolant line right in the rear of the exhaust side, hard to spot specially if your eager to get it off). To loosen the timing belt, theres a pully below centered between the gears, 14mm will kill it nicely.

the cams can come off with the head just loosen the timing belt