Use a compressor like everyone else said. But then contact a used dental parts dealer to buy a foot rheostat (regulator? whatever the foot thingie is). You can also buy a box to add fiber optic light to your handpiece that is activated by the rheostat. I think that's about $100. Leave the garage door open when you drill or the place will stink.
I had a lab in my basement, because i got really lazy my first and second year.
When buying a compressor its not the PSI, its the SCFM (Standard Cubic Feet per Minute) you will want a compressor that has at least a 2.5 SCFM.
Silent compressors are the way to go, unless you have a garage, and if you get a cheapo from homedepot, get a big tank so that the compressor does not keep kicking on and off, otherwise you'll go crazy from the noise.
You'll probably want a moisture trap on you silent compressor, but its not a must. You just then hook everything up (Basically, line from Compressor to Rheostat, rheostat to handpiece or hand piece control switch.)
Rheostat and hosing can be found cheap on EBay or dental surplus stores, but its all a matter of what you find at the time. You can even buy them from dental companies for around $100-150
I wouldn't waste my time with fiber optics, just get a good light as your in the comfort of your own home or garage. I would probably just run one hose from the rheostat, than have a complete setup (high, low and air/water). Forexample, A Star slow speed Handpiece swivel without fiber optics can run a star highspeed handpiece no problem, and its like a quick disconnect, all you do is change handpieces, not the swivel and when you want air, you remove the hand piece and voila, air.
The compressor cost about $400-700 used, rheostat ~150, tubing and fitting from Homedepot for about $10.
Pm me if you need more info.