Novel technologies in remote sensing and ground observations have made it possible to capture the spatial and temporal variations of hydrological variables. In the next decades, their spatial and temporal resolution will increase significantly. This paper provides our thoughts on the watershed observing system in the Digital Heihe River Basin research initiative. First, the latest advances in observing the water cycle using satellite remote sensing, airborne remote sensing, and ground-based observation are reviewed. The next part of the paper presents our prospects on how to build a watershed observing system. The system should take into account various spatiotemporal scales of the land surface, hydrological and ecological processes. It should make it a priority aim to serve the development, validation and modification of integrated watershed models. It should act as an integrated remote sensing and ground based observing system, and should integrate well with information systems and watershed models. The premiums on sampling strategy and new observation methods, and the equal importance of monitoring and control experiments are also discussed in this section. We then introduce the current watershed observing system of the Heihe River Basin as a prototype study. It is composed of well instrumented field stations located along its upper, middle, and lower reaches with different landscapes, and operational meteorological and hydrological networks. Some comprehensive observation experiments have so far been carried out in the Heihe River Basin. They include the HEIFE (Atmosphere-land surface processes experiment at the Heihe River Basin), the Jinta experiment, and the WATER (Watershed Allied Telemetry Experimental Research). The last part of the paper introduces our further thinking of watershed observing system. It is of key importance to enhance the remote sensing observation ability of water cycle and related ecological processes in a river basin scale. It is only possible to better quantify the water cycle through the integration of remote sensing and in situ observations and model simulations. In summary, the water observing system, in good cooperation with watershed information system and integrated watershed models, constitutes a cyberinfrastructure and lays the foundation for the emerging watershed science.