diff --git a/lib/src/async_import_cache.dart b/lib/src/async_import_cache.dart
index dc50aeaa..8b639ad4 100644
--- a/lib/src/async_import_cache.dart
+++ b/lib/src/async_import_cache.dart
@@ -151,6 +151,13 @@ class AsyncImportCache {
     });
   }
 
+  /// Clears the cached canonical version of the given [url].
+  ///
+  /// Has no effect if the canonical version of [url] has not been cached.
+  void clearCanonicalize(Uri url) {
+    _canonicalizeCache.remove(url);
+  }
+
   /// Clears the cached parse tree for the stylesheet with the given
   /// [canonicalUrl].
   ///
diff --git a/lib/src/executable.dart b/lib/src/executable.dart
index 1b0f9df7..9fd65d38 100644
--- a/lib/src/executable.dart
+++ b/lib/src/executable.dart
@@ -11,6 +11,7 @@ import 'exception.dart';
 import 'executable/compile_stylesheet.dart';
 import 'executable/options.dart';
 import 'executable/repl.dart';
+import 'executable/watch.dart';
 import 'import_cache.dart';
 import 'io.dart';
 import 'stylesheet_graph.dart';
@@ -50,10 +51,16 @@ main(List<String> args) async {
 
     var graph = new StylesheetGraph(new ImportCache([],
         loadPaths: options.loadPaths, logger: options.logger));
+    if (options.watch) {
+      await watch(options, graph);
+      return;
+    }
+
     for (var source in options.sourcesToDestinations.keys) {
       var destination = options.sourcesToDestinations[source];
       try {
-        await compileStylesheet(options, graph, source, destination);
+        await compileStylesheet(options, graph, source, destination,
+            ifModified: options.update);
       } on SassException catch (error, stackTrace) {
         // This is an immediately-invoked function expression to work around
         // dart-lang/sdk#33400.
diff --git a/lib/src/executable/compile_stylesheet.dart b/lib/src/executable/compile_stylesheet.dart
index 5bd42d8b..c388f9d3 100644
--- a/lib/src/executable/compile_stylesheet.dart
+++ b/lib/src/executable/compile_stylesheet.dart
@@ -26,10 +26,15 @@ import 'options.dart';
 /// If [source] is `null`, that indicates that the stylesheet should be read
 /// from stdin. If [destination] is `null`, that indicates that the stylesheet
 /// should be emitted to stdout.
+///
+/// If [ifModified] is `true`, only recompiles if [source]'s modification time
+/// or that of a file it imports is more recent than [destination]'s
+/// modification time. Note that these modification times are cached by [graph].
 Future compileStylesheet(ExecutableOptions options, StylesheetGraph graph,
-    String source, String destination) async {
+    String source, String destination,
+    {bool ifModified: false}) async {
   var importer = new FilesystemImporter('.');
-  if (options.update) {
+  if (ifModified) {
     try {
       if (source != null &&
           destination != null &&
@@ -50,7 +55,7 @@ Future compileStylesheet(ExecutableOptions options, StylesheetGraph graph,
           importer: importer,
           logger: options.logger,
           sourceMap: options.emitSourceMap)
-      : await evaluate(stylesheet,
+      : evaluate(stylesheet,
           importCache: graph.importCache,
           importer: importer,
           logger: options.logger,
@@ -68,10 +73,12 @@ Future compileStylesheet(ExecutableOptions options, StylesheetGraph graph,
     writeFile(destination, css + "\n");
   }
 
-  if (!options.update || options.quiet) return;
+  if (options.quiet || (!options.update && !options.watch)) return;
   var buffer = new StringBuffer();
   if (options.color) buffer.write('\u001b[32m');
-  buffer.write('Compiled ${source ?? 'stdin'} to $destination.');
+
+  var sourceName = source == null ? 'stdin' : p.prettyUri(p.toUri(source));
+  buffer.write('Compiled $sourceName to $destination.');
   if (options.color) buffer.write('\u001b[0m');
   print(buffer);
 }
diff --git a/lib/src/executable/options.dart b/lib/src/executable/options.dart
index 08de155d..e1eb02b8 100644
--- a/lib/src/executable/options.dart
+++ b/lib/src/executable/options.dart
@@ -6,6 +6,7 @@ import 'dart:collection';
 
 import 'package:args/args.dart';
 import 'package:charcode/charcode.dart';
+import 'package:collection/collection.dart';
 import 'package:meta/meta.dart';
 
 import '../../sass.dart';
@@ -71,6 +72,9 @@ class ExecutableOptions {
 
     parser
       ..addSeparator(_separator('Other'))
+      ..addFlag('watch',
+          help: 'Watch stylesheets and recompile when they change.',
+          negatable: false)
       ..addFlag('interactive',
           abbr: 'i',
           help: 'Run an interactive SassScript shell.',
@@ -163,6 +167,9 @@ class ExecutableOptions {
   /// Whether to update only files that have changed since the last compilation.
   bool get update => _options['update'] as bool;
 
+  /// Whether to continuously watch the filesystem for changes.
+  bool get watch => _options['watch'] as bool;
+
   /// A map from source paths to the destination paths where the compiled CSS
   /// should be written.
   ///
@@ -172,7 +179,27 @@ class ExecutableOptions {
   /// input. A `null` destination indicates that a stylesheet should be written
   /// to standard output.
   Map<String, String> get sourcesToDestinations {
-    if (_sourcesToDestinations != null) return _sourcesToDestinations;
+    _ensureSources();
+    return _sourcesToDestinations;
+  }
+
+  Map<String, String> _sourcesToDestinations;
+
+  /// A map from source directories to the destination directories where the
+  /// compiled CSS for stylesheets in the source directories should be written.
+  ///
+  /// Considers keys to be the same if they represent the same path on disk.
+  Map<String, String> get sourceDirectoriesToDestinations {
+    _ensureSources();
+    return _sourceDirectoriesToDestinations;
+  }
+
+  Map<String, String> _sourceDirectoriesToDestinations;
+
+  /// Ensure that both [sourcesToDestinations] and [sourceDirectories] have been
+  /// computed.
+  void _ensureSources() {
+    if (_sourcesToDestinations != null) return;
 
     var stdin = _options['stdin'] as bool;
     if (_options.rest.isEmpty && !stdin) _fail("Compile Sass to CSS.");
@@ -203,6 +230,8 @@ class ExecutableOptions {
           _fail("Only one argument is allowed with --stdin.");
         } else if (update) {
           _fail("--update is not allowed with --stdin.");
+        } else if (watch) {
+          _fail("--watch is not allowed with --stdin.");
         }
         _sourcesToDestinations = new Map.unmodifiable(
             {null: _options.rest.isEmpty ? null : _options.rest.first});
@@ -211,13 +240,18 @@ class ExecutableOptions {
       } else {
         var source = _options.rest.first == '-' ? null : _options.rest.first;
         var destination = _options.rest.length == 1 ? null : _options.rest.last;
-        if (update && destination == null) {
-          _fail("--update is not allowed when printing to stdout.");
+        if (destination == null) {
+          if (update) {
+            _fail("--update is not allowed when printing to stdout.");
+          } else if (watch) {
+            _fail("--watch is not allowed when printing to stdout.");
+          }
         }
         _sourcesToDestinations =
             new UnmodifiableMapView(newPathMap({source: destination}));
       }
-      return _sourcesToDestinations;
+      _sourceDirectoriesToDestinations = const {};
+      return;
     }
 
     if (stdin) _fail('--stdin may not be used with ":" arguments.');
@@ -227,6 +261,7 @@ class ExecutableOptions {
     // directories have been resolved.
     var seen = new Set<String>();
     var sourcesToDestinations = newPathMap<String>();
+    var sourceDirectoriesToDestinations = newPathMap<String>();
     for (var argument in _options.rest) {
       String source;
       String destination;
@@ -255,17 +290,17 @@ class ExecutableOptions {
       if (source == '-') {
         sourcesToDestinations[null] = destination;
       } else if (dirExists(source)) {
+        sourceDirectoriesToDestinations[source] = destination;
         sourcesToDestinations.addAll(_listSourceDirectory(source, destination));
       } else {
         sourcesToDestinations[source] = destination;
       }
     }
     _sourcesToDestinations = new UnmodifiableMapView(sourcesToDestinations);
-    return _sourcesToDestinations;
+    _sourceDirectoriesToDestinations =
+        new UnmodifiableMapView(sourceDirectoriesToDestinations);
   }
 
-  Map<String, String> _sourcesToDestinations;
-
   /// Returns whether [string] contains an absolute Windows path at [index].
   bool _isWindowsPath(String string, int index) =>
       string.length > index + 2 &&
diff --git a/lib/src/executable/watch.dart b/lib/src/executable/watch.dart
new file mode 100644
index 00000000..4105d095
--- /dev/null
+++ b/lib/src/executable/watch.dart
@@ -0,0 +1,230 @@
+// Copyright 2018 Google Inc. Use of this source code is governed by an
+// MIT-style license that can be found in the LICENSE file or at
+// https://opensource.org/licenses/MIT.
+
+import 'dart:async';
+import 'dart:collection';
+
+import 'package:stack_trace/stack_trace.dart';
+import 'package:watcher/watcher.dart';
+
+import '../exception.dart';
+import '../importer/filesystem.dart';
+import '../io.dart';
+import '../stylesheet_graph.dart';
+import '../util/multi_dir_watcher.dart';
+import '../util/path.dart';
+import 'compile_stylesheet.dart';
+import 'options.dart';
+
+/// Watches all the files in [graph] for changes and updates them as necessary.
+Future watch(ExecutableOptions options, StylesheetGraph graph) async {
+  var directoriesToWatch = <String>[]
+    ..addAll(options.sourceDirectoriesToDestinations.keys)
+    ..addAll(options.sourcesToDestinations.keys.map((path) => p.dirname(path)))
+    ..addAll(options.loadPaths);
+
+  var dirWatcher = new MultiDirWatcher();
+  await Future.wait(directoriesToWatch.map((dir) {
+    // If a directory doesn't exist, watch its parent directory so that we're
+    // notified once it starts existing.
+    while (!dirExists(dir)) dir = p.dirname(dir);
+    return dirWatcher.watch(dir);
+  }));
+
+  // Before we start paying attention to changes, compile all the stylesheets as
+  // they currently exist. This ensures that changes that come in update a
+  // known-good state.
+  var watcher = new _Watcher(options, graph);
+  for (var source in options.sourcesToDestinations.keys) {
+    var destination = options.sourcesToDestinations[source];
+    graph.addCanonical(new FilesystemImporter('.'),
+        p.toUri(p.canonicalize(source)), p.toUri(source));
+    await watcher.compile(source, destination, ifModified: true);
+  }
+
+  print("Sass is watching for changes. Press Ctrl-C to stop.\n");
+  await watcher.watch(dirWatcher);
+}
+
+/// Holds state that's shared across functions that react to changes on the
+/// filesystem.
+class _Watcher {
+  final ExecutableOptions _options;
+
+  final StylesheetGraph _graph;
+
+  _Watcher(this._options, this._graph);
+
+  /// Compiles the stylesheet at [source] to [destination], and prints any
+  /// errors that occur.
+  Future compile(String source, String destination,
+      {bool ifModified: false}) async {
+    try {
+      await compileStylesheet(_options, _graph, source, destination,
+          ifModified: ifModified);
+    } on SassException catch (error, stackTrace) {
+      _printError(error.toString(color: _options.color), stackTrace);
+      _delete(destination);
+    } on FileSystemException catch (error, stackTrace) {
+      _printError("Error reading ${p.relative(error.path)}: ${error.message}.",
+          stackTrace);
+    }
+  }
+
+  /// Deletes the file at [path] and prints a message about it.
+  void _delete(String path) {
+    try {
+      deleteFile(path);
+      var buffer = new StringBuffer();
+      if (_options.color) buffer.write("\u001b[33m");
+      buffer.write("Deleted $path.");
+      if (_options.color) buffer.write("\u001b[0m");
+      print(buffer);
+    } on FileSystemException {
+      // If the file doesn't exist, that's fine.
+    }
+  }
+
+  /// Prints [message] to standard error, with [stackTrace] if [_options.trace]
+  /// is set.
+  void _printError(String message, StackTrace stackTrace) {
+    stderr.writeln(message);
+
+    if (_options.trace) {
+      stderr.writeln();
+      stderr.writeln(new Trace.from(stackTrace).terse.toString().trimRight());
+    }
+
+    stderr.writeln();
+  }
+
+  /// Listens to `watcher.events` and updates the filesystem accordingly.
+  ///
+  /// Returns a future that will only complete if an unexpected error occurs.
+  Future watch(MultiDirWatcher watcher) async {
+    loop:
+    await for (var event in watcher.events) {
+      var extension = p.extension(event.path);
+      if (extension != '.sass' && extension != '.scss') continue;
+      var url = p.toUri(p.canonicalize(event.path));
+
+      switch (event.type) {
+        case ChangeType.MODIFY:
+          if (!_graph.nodes.containsKey(url)) continue loop;
+
+          _graph.reload(url);
+          await _recompileDownstream([_graph.nodes[url]]);
+          break;
+
+        case ChangeType.ADD:
+          await _retryPotentialImports(event.path);
+
+          var destination = _destinationFor(event.path);
+          if (destination == null) continue loop;
+
+          _graph.addCanonical(
+              new FilesystemImporter('.'), url, p.toUri(event.path));
+
+          await compile(event.path, destination);
+          break;
+
+        case ChangeType.REMOVE:
+          await _retryPotentialImports(event.path);
+          if (!_graph.nodes.containsKey(url)) continue loop;
+
+          var destination = _destinationFor(event.path);
+          if (destination != null) _delete(destination);
+
+          _graph.remove(url);
+          await _recompileDownstream([_graph.nodes[url]]);
+          break;
+      }
+    }
+  }
+
+  /// Recompiles [nodes] and everything that transitively imports them, if
+  /// necessary.
+  Future _recompileDownstream(Iterable<StylesheetNode> nodes) async {
+    var seen = new Set<StylesheetNode>();
+    var toRecompile = new Queue<StylesheetNode>.from(nodes);
+
+    while (!toRecompile.isEmpty) {
+      var node = toRecompile.removeFirst();
+      if (!seen.add(node)) continue;
+
+      await _compileIfEntrypoint(node.canonicalUrl);
+      toRecompile.addAll(node.downstream);
+    }
+  }
+
+  /// Compiles the stylesheet at [url] to CSS if it's an entrypoint that's being
+  /// watched.
+  Future _compileIfEntrypoint(Uri url) async {
+    if (url.scheme != 'file') return;
+
+    var source = p.fromUri(url);
+    var destination = _destinationFor(source);
+    if (destination == null) return;
+
+    await compile(source, destination);
+  }
+
+  /// If a Sass file at [source] should be compiled to CSS, returns the path to
+  /// the CSS file it should be compiled to.
+  ///
+  /// Otherwise, returns `null`.
+  String _destinationFor(String source) {
+    var destination = _options.sourcesToDestinations[source];
+    if (destination != null) return destination;
+    if (p.basename(source).startsWith('_')) return null;
+
+    for (var sourceDir in _options.sourceDirectoriesToDestinations.keys) {
+      if (p.isWithin(sourceDir, source)) {
+        return p.join(_options.sourceDirectoriesToDestinations[sourceDir],
+            p.setExtension(p.relative(source, from: sourceDir), '.css'));
+      }
+    }
+
+    return null;
+  }
+
+  /// Re-runs all imports in [_graph] that might refer to [path], and recompiles
+  /// the files that contain those imports if they end up importing new
+  /// stylesheets.
+  Future _retryPotentialImports(String path) async {
+    var name = _name(p.basename(path));
+    var changed = <StylesheetNode>[];
+    for (var node in _graph.nodes.values) {
+      var importChanged = false;
+      for (var url in node.upstream.keys) {
+        if (_name(pUrl.basename(url.path)) != name) continue;
+        _graph.clearCanonicalize(url);
+
+        // If the import produces a different canonicalized URL than it did
+        // before, it changed and the stylesheet needs to be recompiled.
+        if (!importChanged) {
+          Uri newCanonicalUrl;
+          try {
+            newCanonicalUrl = _graph.importCache
+                .canonicalize(url, node.importer, node.canonicalUrl)
+                ?.item2;
+          } catch (_) {
+            // If the call to canonicalize failed, do nothing. We'll surface the
+            // error more nicely when we try to recompile the file.
+          }
+          importChanged = newCanonicalUrl != node.upstream[url]?.canonicalUrl;
+        }
+      }
+      if (importChanged) changed.add(node);
+    }
+
+    await _recompileDownstream(changed);
+  }
+
+  /// Removes an extension from [extension], and a leading underscore if it has one.
+  String _name(String basename) {
+    basename = p.withoutExtension(basename);
+    return basename.startsWith("_") ? basename.substring(1) : basename;
+  }
+}
diff --git a/lib/src/import_cache.dart b/lib/src/import_cache.dart
index 4e16090c..86dbc070 100644
--- a/lib/src/import_cache.dart
+++ b/lib/src/import_cache.dart
@@ -5,7 +5,7 @@
 // DO NOT EDIT. This file was generated from async_import_cache.dart.
 // See tool/synchronize.dart for details.
 //
-// Checksum: 90302aba01c574ffbc07e75a34606406e48df7fc
+// Checksum: 411ad1e666d5a138e69b51d9bdb58e9b22e88632
 
 import 'package:tuple/tuple.dart';
 
@@ -154,6 +154,13 @@ class ImportCache {
     });
   }
 
+  /// Clears the cached canonical version of the given [url].
+  ///
+  /// Has no effect if the canonical version of [url] has not been cached.
+  void clearCanonicalize(Uri url) {
+    _canonicalizeCache.remove(url);
+  }
+
   /// Clears the cached parse tree for the stylesheet with the given
   /// [canonicalUrl].
   ///
diff --git a/lib/src/io/interface.dart b/lib/src/io/interface.dart
index 04f83139..1f50ac57 100644
--- a/lib/src/io/interface.dart
+++ b/lib/src/io/interface.dart
@@ -4,6 +4,8 @@
 
 import 'dart:async';
 
+import 'package:watcher/watcher.dart';
+
 /// An output sink that writes to this process's standard error.
 class Stderr {
   /// Writes the string representation of [object] to standard error.
@@ -79,3 +81,10 @@ DateTime modificationTime(String path) => null;
 
 /// Gets and sets the exit code that the process will use when it exits.
 int exitCode;
+
+/// Recursively watches the directory at [path] for modifications.
+///
+/// Returns a future that completes with a single-subscription stream once the
+/// directory has been scanned initially. The watch is canceled when the stream
+/// is closed.
+Future<Stream<WatchEvent>> watchDir(String path) => null;
diff --git a/lib/src/io/node.dart b/lib/src/io/node.dart
index 1c4ad6a5..56427dda 100644
--- a/lib/src/io/node.dart
+++ b/lib/src/io/node.dart
@@ -8,8 +8,10 @@ import 'dart:convert';
 import 'package:dart2_constant/convert.dart' as convert;
 import 'package:js/js.dart';
 import 'package:source_span/source_span.dart';
+import 'package:watcher/watcher.dart';
 
 import '../exception.dart';
+import '../node/chokidar.dart';
 import '../util/path.dart';
 
 @JS()
@@ -237,3 +239,34 @@ external int get exitCode;
 
 @JS("process.exitCode")
 external set exitCode(int code);
+
+Future<Stream<WatchEvent>> watchDir(String path) {
+  var watcher =
+      chokidar.watch(path, new ChokidarOptions(disableGlobbing: true));
+
+  // Don't assign the controller until after the ready event fires. Otherwise,
+  // Chokidar will give us a bunch of add events for files that already exist.
+  StreamController<WatchEvent> controller;
+  watcher
+    ..on(
+        'add',
+        allowInterop((String path, _) =>
+            controller?.add(new WatchEvent(ChangeType.ADD, path))))
+    ..on(
+        'change',
+        allowInterop((String path, _) =>
+            controller?.add(new WatchEvent(ChangeType.MODIFY, path))))
+    ..on(
+        'unlink',
+        allowInterop((String path) =>
+            controller?.add(new WatchEvent(ChangeType.REMOVE, path))))
+    ..on('error', allowInterop((error) => controller?.addError(error)));
+
+  var completer = new Completer<Stream<WatchEvent>>();
+  watcher.on('ready', allowInterop(() {
+    controller = new StreamController<WatchEvent>();
+    completer.complete(controller.stream);
+  }));
+
+  return completer.future;
+}
diff --git a/lib/src/io/vm.dart b/lib/src/io/vm.dart
index cb5969cc..afc15f6b 100644
--- a/lib/src/io/vm.dart
+++ b/lib/src/io/vm.dart
@@ -5,9 +5,11 @@
 import 'dart:async';
 import 'dart:io' as io;
 
+import 'package:async/async.dart';
 import 'package:dart2_constant/convert.dart' as convert;
 import 'package:path/path.dart' as p;
 import 'package:source_span/source_span.dart';
+import 'package:watcher/watcher.dart';
 
 import '../exception.dart';
 
@@ -71,3 +73,16 @@ DateTime modificationTime(String path) {
   }
   return stat.modified;
 }
+
+Future<Stream<WatchEvent>> watchDir(String path) async {
+  var watcher = new DirectoryWatcher(path);
+
+  // Wrap [stream] in a [SubscriptionStream] so that its `onListen` event
+  // triggers but the caller can still listen at their leisure.
+  var stream = new SubscriptionStream<WatchEvent>(watcher.events
+      .transform(const SingleSubscriptionTransformer<WatchEvent, WatchEvent>())
+      .listen((e) => print(e)));
+  await watcher.ready;
+
+  return stream;
+}
diff --git a/lib/src/node/chokidar.dart b/lib/src/node/chokidar.dart
new file mode 100644
index 00000000..3cd49fbe
--- /dev/null
+++ b/lib/src/node/chokidar.dart
@@ -0,0 +1,32 @@
+// Copyright 2018 Google Inc. Use of this source code is governed by an
+// MIT-style license that can be found in the LICENSE file or at
+// https://opensource.org/licenses/MIT.
+
+import 'package:js/js.dart';
+
+@JS("require")
+external Chokidar _require(String name);
+
+@JS()
+class Chokidar {
+  external ChokidarWatcher watch(String path, ChokidarOptions options);
+}
+
+@JS()
+@anonymous
+class ChokidarOptions {
+  external bool get disableGlobbing;
+
+  external factory ChokidarOptions({bool disableGlobbing});
+}
+
+@JS()
+class ChokidarWatcher {
+  external void on(String event, Function callback);
+  external void close();
+}
+
+/// The Chokidar module.
+///
+/// See [the docs on npm](https://www.npmjs.com/package/chokidar).
+final chokidar = _require("chokidar");
diff --git a/lib/src/stylesheet_graph.dart b/lib/src/stylesheet_graph.dart
index ee41cba9..643b4f3c 100644
--- a/lib/src/stylesheet_graph.dart
+++ b/lib/src/stylesheet_graph.dart
@@ -130,6 +130,7 @@ class StylesheetGraph {
       remove(canonicalUrl);
       return null;
     }
+    node._stylesheet = stylesheet;
 
     node._stylesheet = stylesheet;
     node._replaceUpstream(
@@ -191,6 +192,17 @@ class StylesheetGraph {
     return node;
   }
 
+  /// Clears the cached canonical version of the given [url] in [importCache].
+  ///
+  /// Also resets the cached modification times for stylesheets in the graph.
+  void clearCanonicalize(Uri url) {
+    // Rather than spending time computing exactly which modification times
+    // should be updated, just clear the cache and let it be computed again
+    // later.
+    _transitiveModificationTimes.clear();
+    importCache.clearCanonicalize(url);
+  }
+
   /// Runs [callback] and returns its result.
   ///
   /// If [callback] throws any errors, ignores them and returns `null`. This is
diff --git a/lib/src/util/multi_dir_watcher.dart b/lib/src/util/multi_dir_watcher.dart
new file mode 100644
index 00000000..c8331c8a
--- /dev/null
+++ b/lib/src/util/multi_dir_watcher.dart
@@ -0,0 +1,53 @@
+// Copyright 2018 Google Inc. Use of this source code is governed by an
+// MIT-style license that can be found in the LICENSE file or at
+// https://opensource.org/licenses/MIT.
+
+import 'dart:async';
+
+import 'package:async/async.dart';
+import 'package:watcher/watcher.dart';
+
+import '../io.dart';
+import 'path.dart';
+
+/// Watches multiple directories which may change over time recursively for changes.
+///
+/// This ensures that each directory is only watched once, even if one is a
+/// parent of another.
+class MultiDirWatcher {
+  /// A map from paths to the event streams for those paths.
+  ///
+  /// No key in this map is a parent directories of any other key in this map.
+  final _watchers = <String, Stream<WatchEvent>>{};
+
+  /// The stream of events from all directories that are being watched.
+  Stream<WatchEvent> get events => _group.stream;
+  final _group = new StreamGroup<WatchEvent>();
+
+  /// Watches [directory] for changes.
+  ///
+  /// Returns a [Future] that completes when [events] is ready to emit events
+  /// from [directory].
+  Future<void> watch(String directory) {
+    var isParentOfExistingDir = false;
+    for (var existingDir in _watchers.keys.toList()) {
+      if (!isParentOfExistingDir &&
+          (p.equals(existingDir, directory) ||
+              p.isWithin(existingDir, directory))) {
+        return new Future.value();
+      }
+
+      if (p.isWithin(directory, existingDir)) {
+        _group.remove(_watchers.remove(existingDir));
+        isParentOfExistingDir = true;
+      }
+    }
+
+    var future = watchDir(directory);
+    var stream = StreamCompleter.fromFuture(future);
+    _watchers[directory] = stream;
+    _group.add(stream);
+
+    return future;
+  }
+}
diff --git a/package.json b/package.json
index 63e2596e..c95d61a4 100644
--- a/package.json
+++ b/package.json
@@ -4,6 +4,7 @@
     "install dependencies used for testing the Node API."
   ],
   "devDependencies": {
+    "chokidar": "^2.0.0",
     "fibers": ">=1.0.0 <3.0.0",
     "intercept-stdout": "^0.1.2"
   }
diff --git a/package/package.json b/package/package.json
index 5e3db1ad..d5719fec 100644
--- a/package/package.json
+++ b/package/package.json
@@ -16,6 +16,9 @@
   "engines": {
     "node": ">=0.11.8"
   },
+  "dependencies": {
+    "chokidar": "^2.0.0"
+  },
   "main": "sass.dart.js",
   "bin": "sass.js",
   "keywords": ["style", "scss", "sass", "preprocessor", "css"]
diff --git a/pubspec.yaml b/pubspec.yaml
index 06350b21..91671260 100644
--- a/pubspec.yaml
+++ b/pubspec.yaml
@@ -19,13 +19,14 @@ dependencies:
   convert: "^2.0.1"
   dart2_constant: "^1.0.0"
   meta: "^1.1.0"
+  package_resolver: "^1.0.0"
   path: "^1.6.0"
   source_maps: "^0.10.5"
   source_span: "^1.4.0"
-  string_scanner: ">=0.1.5 <2.0.0"
   stack_trace: ">=0.9.0 <2.0.0"
+  string_scanner: ">=0.1.5 <2.0.0"
   tuple: "^1.0.0"
-  package_resolver: ^1.0.0
+  watcher: "^0.9.6"
 
 dev_dependencies:
   archive: ">=1.0.0 <3.0.0"
diff --git a/test/cli/dart/watch_test.dart b/test/cli/dart/watch_test.dart
new file mode 100644
index 00000000..418aea78
--- /dev/null
+++ b/test/cli/dart/watch_test.dart
@@ -0,0 +1,14 @@
+// Copyright 2018 Google Inc. Use of this source code is governed by an
+// MIT-style license that can be found in the LICENSE file or at
+// https://opensource.org/licenses/MIT.
+
+@TestOn('vm')
+
+import 'package:test/test.dart';
+
+import '../dart_test.dart';
+import '../shared/watch.dart';
+
+void main() {
+  sharedTests(runSass);
+}
diff --git a/test/cli/node/watch_test.dart b/test/cli/node/watch_test.dart
new file mode 100644
index 00000000..9c02e763
--- /dev/null
+++ b/test/cli/node/watch_test.dart
@@ -0,0 +1,17 @@
+// Copyright 2018 Google Inc. Use of this source code is governed by an
+// MIT-style license that can be found in the LICENSE file or at
+// https://opensource.org/licenses/MIT.
+
+@TestOn('vm')
+@Tags(const ['node'])
+
+import 'package:test/test.dart';
+
+import '../../ensure_npm_package.dart';
+import '../node_test.dart';
+import '../shared/watch.dart';
+
+void main() {
+  setUpAll(ensureNpmPackage);
+  sharedTests(runSass);
+}
diff --git a/test/cli/shared/watch.dart b/test/cli/shared/watch.dart
new file mode 100644
index 00000000..f6bfad1c
--- /dev/null
+++ b/test/cli/shared/watch.dart
@@ -0,0 +1,457 @@
+// Copyright 2018 Google Inc. Use of this source code is governed by an
+// MIT-style license that can be found in the LICENSE file or at
+// https://opensource.org/licenses/MIT.
+
+import 'dart:async';
+import 'dart:io';
+
+import 'package:test/test.dart';
+import 'package:test_descriptor/test_descriptor.dart' as d;
+import 'package:test_process/test_process.dart';
+
+import 'package:sass/src/util/path.dart';
+
+import '../../utils.dart';
+
+/// Defines test that are shared between the Dart and Node.js CLI test suites.
+void sharedTests(Future<TestProcess> runSass(Iterable<String> arguments)) {
+  Future<TestProcess> watch(Iterable<String> arguments) =>
+      runSass(["--no-source-map", "--watch"]..addAll(arguments));
+
+  group("when started", () {
+    test("updates a CSS file whose source was modified", () async {
+      await d.file("out.css", "x {y: z}").create();
+      await new Future.delayed(new Duration(milliseconds: 10));
+      await d.file("test.scss", "a {b: c}").create();
+
+      var sass = await watch(["test.scss:out.css"]);
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await expectLater(sass.stdout, _watchingForChanges);
+      await sass.kill();
+
+      await d
+          .file("out.css", equalsIgnoringWhitespace("a { b: c; }"))
+          .validate();
+    });
+
+    test("doesn't update a CSS file that wasn't modified", () async {
+      await d.file("test.scss", "a {b: c}").create();
+      await d.file("out.css", "x {y: z}").create();
+
+      var sass = await watch(["test.scss:out.css"]);
+      await expectLater(sass.stdout, _watchingForChanges);
+      await sass.kill();
+
+      await d.file("out.css", "x {y: z}").validate();
+    });
+  });
+
+  group("recompiles a watched file", () {
+    test("when it's modified", () async {
+      await d.file("test.scss", "a {b: c}").create();
+
+      var sass = await watch(["test.scss:out.css"]);
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await expectLater(sass.stdout, _watchingForChanges);
+
+      await d.file("test.scss", "x {y: z}").create();
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await sass.kill();
+
+      await d
+          .file("out.css", equalsIgnoringWhitespace("x { y: z; }"))
+          .validate();
+    });
+
+    test("when it's modified when watched from a directory", () async {
+      await d.dir("dir", [d.file("test.scss", "a {b: c}")]).create();
+
+      var sass = await watch(["dir:out"]);
+      await expectLater(
+          sass.stdout, emits('Compiled dir/test.scss to out/test.css.'));
+      await expectLater(sass.stdout, _watchingForChanges);
+
+      await d.dir("dir", [d.file("test.scss", "x {y: z}")]).create();
+      await expectLater(
+          sass.stdout, emits('Compiled dir/test.scss to out/test.css.'));
+      await sass.kill();
+
+      await d.dir("out", [
+        d.file("test.css", equalsIgnoringWhitespace("x { y: z; }"))
+      ]).validate();
+    });
+
+    test("when its dependency is modified", () async {
+      await d.file("_other.scss", "a {b: c}").create();
+      await d.file("test.scss", "@import 'other'").create();
+
+      var sass = await watch(["test.scss:out.css"]);
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await expectLater(sass.stdout, _watchingForChanges);
+
+      await d.file("_other.scss", "x {y: z}").create();
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await sass.kill();
+
+      await d
+          .file("out.css", equalsIgnoringWhitespace("x { y: z; }"))
+          .validate();
+    });
+
+    test("when it's deleted and re-added", () async {
+      await d.file("test.scss", "a {b: c}").create();
+
+      var sass = await watch(["test.scss:out.css"]);
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await expectLater(sass.stdout, _watchingForChanges);
+
+      new File(p.join(d.sandbox, "test.scss")).deleteSync();
+      await expectLater(sass.stdout, emits('Deleted out.css.'));
+
+      await d.file("test.scss", "x {y: z}").create();
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await sass.kill();
+
+      await d
+          .file("out.css", equalsIgnoringWhitespace("x { y: z; }"))
+          .validate();
+    });
+
+    group("when its dependency is deleted", () {
+      test("and removes the output", () async {
+        await d.file("_other.scss", "a {b: c}").create();
+        await d.file("test.scss", "@import 'other'").create();
+
+        var sass = await watch(["test.scss:out.css"]);
+        await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+        await expectLater(sass.stdout, _watchingForChanges);
+
+        new File(p.join(d.sandbox, "_other.scss")).deleteSync();
+        await expectLater(
+            sass.stderr, emits("Error: Can't find stylesheet to import."));
+        await expectLater(sass.stderr, emitsThrough(contains('test.scss 1:9')));
+        await sass.kill();
+
+        await d.nothing("out.css").validate();
+      });
+
+      test("but another is available", () async {
+        await d.file("_other.scss", "a {b: c}").create();
+        await d.file("test.scss", "@import 'other'").create();
+        await d.dir("dir", [d.file("_other.scss", "x {y: z}")]).create();
+
+        var sass = await watch(["-I", "dir", "test.scss:out.css"]);
+        await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+        await expectLater(sass.stdout, _watchingForChanges);
+
+        new File(p.join(d.sandbox, "_other.scss")).deleteSync();
+        await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+        await sass.kill();
+
+        await d
+            .file("out.css", equalsIgnoringWhitespace("x { y: z; }"))
+            .validate();
+      });
+
+      test("which resolves a conflict", () async {
+        await d.file("_other.scss", "a {b: c}").create();
+        await d.file("_other.sass", "x\n  y: z").create();
+        await d.file("test.scss", "@import 'other'").create();
+
+        var sass = await watch(["test.scss:out.css"]);
+        await expectLater(sass.stderr,
+            emits("Error: It's not clear which file to import. Found:"));
+        await expectLater(sass.stdout, _watchingForChanges);
+
+        new File(p.join(d.sandbox, "_other.sass")).deleteSync();
+        await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+        await sass.kill();
+
+        await d
+            .file("out.css", equalsIgnoringWhitespace("a { b: c; }"))
+            .validate();
+      });
+    });
+
+    group("when a dependency is added", () {
+      group("that was missing", () {
+        test("relative to the file", () async {
+          await d.file("test.scss", "@import 'other'").create();
+
+          var sass = await watch(["test.scss:out.css"]);
+          await expectLater(
+              sass.stderr, emits("Error: Can't find stylesheet to import."));
+          await expectLater(
+              sass.stderr, emitsThrough(contains("test.scss 1:9")));
+          await expectLater(sass.stdout, _watchingForChanges);
+
+          await d.file("_other.scss", "a {b: c}").create();
+          await expectLater(
+              sass.stdout, emits('Compiled test.scss to out.css.'));
+          await sass.kill();
+
+          await d
+              .file("out.css", equalsIgnoringWhitespace("a { b: c; }"))
+              .validate();
+        });
+
+        test("on a load path", () async {
+          await d.file("test.scss", "@import 'other'").create();
+          await d.dir("dir").create();
+
+          var sass = await watch(["-I", "dir", "test.scss:out.css"]);
+          await expectLater(
+              sass.stderr, emits("Error: Can't find stylesheet to import."));
+          await expectLater(
+              sass.stderr, emitsThrough(contains("test.scss 1:9")));
+          await expectLater(sass.stdout, _watchingForChanges);
+
+          await d.dir("dir", [d.file("_other.scss", "a {b: c}")]).create();
+          await expectLater(
+              sass.stdout, emits('Compiled test.scss to out.css.'));
+          await sass.kill();
+
+          await d
+              .file("out.css", equalsIgnoringWhitespace("a { b: c; }"))
+              .validate();
+        });
+
+        test("on a load path that was created", () async {
+          await d
+              .dir("dir1", [d.file("test.scss", "@import 'other'")]).create();
+
+          var sass = await watch(["-I", "dir2", "dir1:out"]);
+          await expectLater(
+              sass.stderr, emits("Error: Can't find stylesheet to import."));
+          await expectLater(
+              sass.stderr, emitsThrough(contains("dir1/test.scss 1:9")));
+          await expectLater(sass.stdout, _watchingForChanges);
+
+          await d.dir("dir2", [d.file("_other.scss", "a {b: c}")]).create();
+          await expectLater(
+              sass.stdout, emits('Compiled dir1/test.scss to out/test.css.'));
+          await sass.kill();
+
+          await d
+              .file("out/test.css", equalsIgnoringWhitespace("a { b: c; }"))
+              .validate();
+        });
+      });
+
+      test("that conflicts with the previous dependency", () async {
+        await d.file("_other.scss", "a {b: c}").create();
+        await d.file("test.scss", "@import 'other'").create();
+
+        var sass = await watch(["test.scss:out.css"]);
+        await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+        await expectLater(sass.stdout, _watchingForChanges);
+
+        await d.file("_other.sass", "x\n  y: z").create();
+        await expectLater(sass.stderr,
+            emits("Error: It's not clear which file to import. Found:"));
+        await expectLater(sass.stdout, emits("Deleted out.css."));
+        await sass.kill();
+
+        await d.nothing("out.css").validate();
+      });
+
+      group("that overrides the previous dependency", () {
+        test("on an import path", () async {
+          await d.file("test.scss", "@import 'other'").create();
+          await d.dir("dir2", [d.file("_other.scss", "a {b: c}")]).create();
+          await d.dir("dir1").create();
+
+          var sass =
+              await watch(["-I", "dir1", "-I", "dir2", "test.scss:out.css"]);
+          await expectLater(
+              sass.stdout, emits('Compiled test.scss to out.css.'));
+          await expectLater(sass.stdout, _watchingForChanges);
+
+          await d.dir("dir1", [d.file("_other.scss", "x {y: z}")]).create();
+          await expectLater(
+              sass.stdout, emits('Compiled test.scss to out.css.'));
+          await sass.kill();
+
+          await d
+              .file("out.css", equalsIgnoringWhitespace("x { y: z; }"))
+              .validate();
+        });
+
+        test("because it's relative", () async {
+          await d.file("test.scss", "@import 'other'").create();
+          await d.dir("dir", [d.file("_other.scss", "a {b: c}")]).create();
+
+          var sass = await watch(["-I", "dir", "test.scss:out.css"]);
+          await expectLater(
+              sass.stdout, emits('Compiled test.scss to out.css.'));
+          await expectLater(sass.stdout, _watchingForChanges);
+
+          await d.file("_other.scss", "x {y: z}").create();
+          await expectLater(
+              sass.stdout, emits('Compiled test.scss to out.css.'));
+          await sass.kill();
+
+          await d
+              .file("out.css", equalsIgnoringWhitespace("x { y: z; }"))
+              .validate();
+        });
+
+        test("because it's not an index", () async {
+          await d.file("test.scss", "@import 'other'").create();
+          await d.dir("other", [d.file("_index.scss", "a {b: c}")]).create();
+
+          var sass = await watch(["test.scss:out.css"]);
+          await expectLater(
+              sass.stdout, emits('Compiled test.scss to out.css.'));
+          await expectLater(sass.stdout, _watchingForChanges);
+
+          await d.file("_other.scss", "x {y: z}").create();
+          await expectLater(
+              sass.stdout, emits('Compiled test.scss to out.css.'));
+          await sass.kill();
+
+          await d
+              .file("out.css", equalsIgnoringWhitespace("x { y: z; }"))
+              .validate();
+        });
+      });
+
+      test("gracefully handles a parse error", () async {
+        await d.dir("dir").create();
+
+        var sass = await watch(["dir:out"]);
+        await expectLater(sass.stdout, _watchingForChanges);
+
+        await d.dir("dir", [d.file("test.scss", "a {b: }")]).create();
+        await expectLater(sass.stderr, emits('Error: Expected expression.'));
+        await sass.kill();
+      });
+    });
+  });
+
+  group("doesn't recompile the watched file", () {
+    test("when an unrelated file is modified", () async {
+      await d.dir("dir", [
+        d.file("test1.scss", "a {b: c}"),
+        d.file("test2.scss", "a {b: c}")
+      ]).create();
+
+      var sass = await watch(["dir:out"]);
+      await expectLater(
+          sass.stdout,
+          emitsInAnyOrder([
+            'Compiled dir/test1.scss to out/test1.css.',
+            'Compiled dir/test2.scss to out/test2.css.'
+          ]));
+      await expectLater(sass.stdout, _watchingForChanges);
+
+      await d.dir("dir", [d.file("test2.scss", "x {y: z}")]).create();
+      await expectLater(
+          sass.stdout, emits('Compiled dir/test2.scss to out/test2.css.'));
+      expect(
+          sass.stdout, neverEmits('Compiled dir/test1.scss to out/test1.css.'));
+      await tick;
+      await sass.kill();
+    });
+
+    test("when a potential dependency that's not actually imported is added",
+        () async {
+      await d.file("test.scss", "@import 'other'").create();
+      await d.file("_other.scss", "a {b: c}").create();
+      await d.dir("dir").create();
+
+      var sass = await watch(["-I", "dir", "test.scss:out.css"]);
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await expectLater(sass.stdout, _watchingForChanges);
+
+      await d.dir("dir", [d.file("_other.scss", "a {b: c}")]).create();
+      expect(sass.stdout, neverEmits('Compiled test.scss to out.css.'));
+      await tick;
+      await sass.kill();
+
+      await d
+          .file("out.css", equalsIgnoringWhitespace("a { b: c; }"))
+          .validate();
+    });
+  });
+
+  group("deletes the CSS", () {
+    test("when a file is deleted", () async {
+      await d.file("test.scss", "a {b: c}").create();
+
+      var sass = await watch(["test.scss:out.css"]);
+      await expectLater(sass.stdout, emits('Compiled test.scss to out.css.'));
+      await expectLater(sass.stdout, _watchingForChanges);
+
+      new File(p.join(d.sandbox, "test.scss")).deleteSync();
+      await expectLater(sass.stdout, emits('Deleted out.css.'));
+      await sass.kill();
+
+      await d.nothing("out.css").validate();
+    });
+
+    test("when a file is deleted within a directory", () async {
+      await d.dir("dir", [d.file("test.scss", "a {b: c}")]).create();
+
+      var sass = await watch(["dir:out"]);
+      await expectLater(
+          sass.stdout, emits('Compiled dir/test.scss to out/test.css.'));
+      await expectLater(sass.stdout, _watchingForChanges);
+
+      new File(p.join(d.sandbox, "dir", "test.scss")).deleteSync();
+      await expectLater(sass.stdout, emits('Deleted out/test.css.'));
+      await sass.kill();
+
+      await d.dir("dir", [d.nothing("out.css")]).validate();
+    });
+  });
+
+  test("creates a new CSS file when a Sass file is added", () async {
+    await d.dir("dir").create();
+
+    var sass = await watch(["dir:out"]);
+    await expectLater(sass.stdout, _watchingForChanges);
+
+    await d.dir("dir", [d.file("test.scss", "a {b: c}")]).create();
+    await expectLater(
+        sass.stdout, emits('Compiled dir/test.scss to out/test.css.'));
+    await sass.kill();
+
+    await d.dir("out", [
+      d.file("test.css", equalsIgnoringWhitespace("a { b: c; }"))
+    ]).validate();
+  });
+
+  test("doesn't create a new CSS file when a partial is added", () async {
+    await d.dir("dir").create();
+
+    var sass = await watch(["dir:out"]);
+    await expectLater(sass.stdout, _watchingForChanges);
+
+    await d.dir("dir", [d.file("_test.scss", "a {b: c}")]).create();
+    expect(sass.stdout, neverEmits('Compiled dir/test.scss to out/test.css.'));
+    await tick;
+    await sass.kill();
+
+    await d.nothing("out/test.scss").validate();
+  });
+
+  group("doesn't allow", () {
+    test("--stdin", () async {
+      var sass = await watch(["--stdin", "test.scss"]);
+      expect(sass.stdout, emits('--watch is not allowed with --stdin.'));
+      await sass.shouldExit(64);
+    });
+
+    test("printing to stderr", () async {
+      var sass = await watch(["test.scss"]);
+      expect(sass.stdout,
+          emits('--watch is not allowed when printing to stdout.'));
+      await sass.shouldExit(64);
+    });
+  });
+}
+
+/// Matches the output that indicates that Sass is watching for changes.
+final _watchingForChanges =
+    emitsInOrder(["Sass is watching for changes. Press Ctrl-C to stop.", ""]);