diff --git a/lib/compass/commands/watch_project.rb b/lib/compass/commands/watch_project.rb
index 97eb2fe99f..ee0528d8ff 100644
--- a/lib/compass/commands/watch_project.rb
+++ b/lib/compass/commands/watch_project.rb
@@ -14,17 +14,30 @@ def perform
           puts ""
           exit 0
         end
+
+        recompile
+
         puts ">>> Compass is watching for changes. Press Ctrl-C to Stop."
-        loop do
-          # TODO: Make this efficient by using filesystem monitoring.
-          compiler = new_compiler_instance(:quiet => true)
-          remove_obsolete_css(compiler)
-          recompile(compiler)
-          sleep 1
+
+        require File.join(Compass.lib_directory, 'vendor', 'fssm')
+
+        FSSM.monitor do |monitor|
+          Compass.configuration.sass_load_paths.each do |load_path|
+            monitor.path load_path do |path|
+              path.glob '**/*.sass'
+
+              path.update &method(:recompile)
+              path.delete {|base, relative| remove_obsolete_css(base,relative); recompile(base, relative)}
+              path.create &method(:recompile)
+            end
+          end
+
         end
+        
       end
 
-      def remove_obsolete_css(compiler)
+      def remove_obsolete_css(base = nil, relative = nil)
+        compiler = new_compiler_instance(:quiet => true)
         sass_files = compiler.sass_files
         deleted_sass_files = (last_sass_files || []) - sass_files
         deleted_sass_files.each do |deleted_sass_file|
@@ -34,7 +47,8 @@ def remove_obsolete_css(compiler)
         self.last_sass_files = sass_files
       end
 
-      def recompile(compiler)
+      def recompile(base = nil, relative = nil)
+        compiler = new_compiler_instance(:quiet => true)
         if file = compiler.out_of_date?
           begin
             puts ">>> Change detected to: #{file}"
diff --git a/lib/vendor/fssm.rb b/lib/vendor/fssm.rb
new file mode 100644
index 0000000000..d04b32aad2
--- /dev/null
+++ b/lib/vendor/fssm.rb
@@ -0,0 +1,30 @@
+module FSSM
+  FileNotFoundError = Class.new(StandardError)
+  CallbackError = Class.new(StandardError)
+  
+  class << self
+    def monitor(*args, &block)
+      monitor = FSSM::Monitor.new
+      context = args.empty? ? monitor : monitor.path(*args)
+      if block && block.arity == 0
+        context.instance_eval(&block)
+      elsif block && block.arity == 1
+        block.call(context)
+      end
+      monitor.run
+    end
+  end
+end
+
+$:.unshift(File.dirname(__FILE__))
+require 'pathname'
+require 'fssm/ext'
+require 'fssm/support'
+require 'fssm/path'
+require 'fssm/state'
+require 'fssm/monitor'
+
+require "fssm/backends/#{FSSM::Support.backend.downcase}"
+FSSM::Backends::Default = FSSM::Backends.const_get(FSSM::Support.backend)
+$:.shift
+
diff --git a/lib/vendor/fssm/backends/fsevents.rb b/lib/vendor/fssm/backends/fsevents.rb
new file mode 100644
index 0000000000..0790a92266
--- /dev/null
+++ b/lib/vendor/fssm/backends/fsevents.rb
@@ -0,0 +1,78 @@
+module FSSM::Backends
+  class FSEvents    
+    def initialize(options={})
+      @streams   = []
+      @handlers  = {}
+      @allocator = options[:allocator] || OSX::KCFAllocatorDefault
+      @context   = options[:context]   || nil
+      @since     = options[:since]     || OSX::KFSEventStreamEventIdSinceNow
+      @latency   = options[:latency]   || 0.0
+      @flags     = options[:flags]     || 0
+    end
+    
+    def add_path(path, preload=true)
+      @handlers["#{path}"] = FSSM::State.new(path, preload)
+      
+      cb = lambda do |stream, context, number, paths, flags, ids|
+        paths.regard_as('*')
+        watched = OSX.FSEventStreamCopyPathsBeingWatched(stream).first
+        @handlers["#{watched}"].refresh
+        # TODO: support this level of granularity
+        # number.times do |n|
+        #   @handlers["#{watched}"].refresh_path(paths[n])
+        # end
+      end
+      
+      @streams << create_stream(cb, "#{path}")
+    end
+    
+    def run
+      @streams.each do |stream|
+        schedule_stream(stream)
+        start_stream(stream)
+      end
+      
+      begin
+        OSX.CFRunLoopRun
+      rescue Interrupt
+        @streams.each do |stream|
+          stop_stream(stream)
+          invalidate_stream(stream)
+          release_stream(stream)
+        end
+      end
+      
+    end
+    
+    private
+    
+    def create_stream(callback, paths)
+      paths = [paths] unless paths.is_a?(Array)
+      OSX.FSEventStreamCreate(@allocator, callback, @context, paths, @since, @latency, @flags)
+    end
+    
+    def schedule_stream(stream, options={})
+      run_loop  = options[:run_loop]  || OSX.CFRunLoopGetCurrent
+      loop_mode = options[:loop_mode] || OSX::KCFRunLoopDefaultMode
+      
+      OSX.FSEventStreamScheduleWithRunLoop(stream, run_loop, loop_mode)
+    end
+    
+    def start_stream(stream)
+      OSX.FSEventStreamStart(stream)
+    end
+    
+    def stop_stream(stream)
+      OSX.FSEventStreamStop(stream)
+    end
+    
+    def invalidate_stream(stream)
+      OSX.FSEventStreamInvalidate(stream)
+    end
+    
+    def release_stream(stream)
+      OSX.FSEventStreamRelease(stream)
+    end
+    
+  end
+end
diff --git a/lib/vendor/fssm/backends/polling.rb b/lib/vendor/fssm/backends/polling.rb
new file mode 100644
index 0000000000..0879775705
--- /dev/null
+++ b/lib/vendor/fssm/backends/polling.rb
@@ -0,0 +1,24 @@
+module FSSM::Backends
+  class Polling
+  def initialize(options={})
+    @handlers  = []
+    @latency   = options[:latency]   || 1
+  end
+  
+  def add_path(path, preload=true)
+    @handlers << FSSM::State.new(path, preload)
+  end
+  
+  def run
+    begin
+      loop do
+        start = Time.now.to_f
+        @handlers.each {|handler| handler.refresh}
+        nap_time = @latency - (Time.now.to_f - start)
+        sleep nap_time if nap_time > 0
+      end
+    rescue Interrupt
+    end
+  end
+end
+end
diff --git a/lib/vendor/fssm/ext.rb b/lib/vendor/fssm/ext.rb
new file mode 100644
index 0000000000..5014617482
--- /dev/null
+++ b/lib/vendor/fssm/ext.rb
@@ -0,0 +1,7 @@
+class Pathname
+  class << self
+    def for(path)
+      path.is_a?(Pathname) ? path : new(path)
+    end
+  end
+end
diff --git a/lib/vendor/fssm/monitor.rb b/lib/vendor/fssm/monitor.rb
new file mode 100644
index 0000000000..bda386d032
--- /dev/null
+++ b/lib/vendor/fssm/monitor.rb
@@ -0,0 +1,21 @@
+class FSSM::Monitor
+  def initialize(options={})
+    @options = options
+    @backend = FSSM::Backends::Default.new
+  end
+  
+  def path(*args, &block)
+    path = FSSM::Path.new(*args)
+    if block && block.arity == 0
+      path.instance_eval(&block)
+    elsif block && block.arity == 1
+      block.call(path)
+    end
+    @backend.add_path(path)
+    path
+  end
+  
+  def run
+    @backend.run
+  end
+end
diff --git a/lib/vendor/fssm/path.rb b/lib/vendor/fssm/path.rb
new file mode 100644
index 0000000000..8b78133877
--- /dev/null
+++ b/lib/vendor/fssm/path.rb
@@ -0,0 +1,88 @@
+class FSSM::Path
+  def initialize(path=nil, glob=nil, &block)
+    set_path(path || '.')
+    set_glob(glob || '**/*')
+    init_callbacks
+    if block && block.arity == 0
+      self.instance_eval(&block)
+    elsif block && block.arity == 1
+      block.call(self)
+    end
+  end
+  
+  def to_s
+    @path.to_s
+  end
+  
+  def to_pathname
+    @path
+  end
+  
+  def glob(value=nil)
+    return @glob if value.nil?
+    set_glob(value)
+  end
+  
+  def create(callback_or_path=nil, &block)
+    callback_action(:create, (block_given? ? block : callback_or_path))
+  end
+  
+  def update(callback_or_path=nil, &block)
+    callback_action(:update, (block_given? ? block : callback_or_path))
+  end
+  
+  def delete(callback_or_path=nil, &block)
+    callback_action(:delete, (block_given? ? block : callback_or_path))
+  end
+  
+  private
+  
+  def init_callbacks
+    do_nothing = lambda {|base, relative|}
+    @callbacks = Hash.new(do_nothing)
+  end
+  
+  def callback_action(type, arg=nil)
+    if arg.is_a?(Proc)
+      set_callback(type, arg)
+    elsif arg.nil?
+      get_callback(type)
+    else
+      run_callback(type, arg)
+    end
+  end
+  
+  def set_callback(type, arg)
+    raise ArgumentError, "Proc expected" unless arg.is_a?(Proc)
+    @callbacks[type] = arg
+  end
+  
+  def get_callback(type)
+    @callbacks[type]
+  end
+  
+  def run_callback(type, arg)
+    base, relative = split_path(arg)
+    
+    begin
+      @callbacks[type].call(base, relative)
+    rescue Exception => e
+      raise FSSM::CallbackError, "#{type} - #{base.join(relative)}: #{e.message}", e.backtrace
+    end
+  end
+  
+  def split_path(path)
+    path = Pathname.for(path)
+    [@path, (path.relative? ? path : path.relative_path_from(@path))] 
+  end
+  
+  def set_path(path)
+    path = Pathname.for(path)
+    raise FSSM::FileNotFoundError, "#{path}" unless path.exist?
+    @path = path.realpath
+  end
+  
+  def set_glob(glob)
+    @glob = glob.is_a?(Array) ? glob : [glob]
+  end
+end
diff --git a/lib/vendor/fssm/state.rb b/lib/vendor/fssm/state.rb
new file mode 100644
index 0000000000..fe514c3f1b
--- /dev/null
+++ b/lib/vendor/fssm/state.rb
@@ -0,0 +1,46 @@
+class FSSM::State
+  def initialize(path, preload=true)
+    @path = path
+    @snapshot = {}
+    snapshot if preload
+  end
+  
+  def refresh
+    previous = @snapshot
+    current = snapshot
+    
+    deleted(previous, current)
+    created(previous, current)
+    modified(previous, current)    
+  end
+  
+  private
+  
+  def created(previous, current)
+    (current.keys - previous.keys).each {|created| @path.create(created)}
+  end
+  
+  def deleted(previous, current)
+    (previous.keys - current.keys).each {|deleted| @path.delete(deleted)}
+  end
+  
+  def modified(previous, current)
+    (current.keys & previous.keys).each do |file|
+      @path.update(file) if (current[file] <=> previous[file]) != 0
+    end
+  end
+  
+  def snapshot
+    snap = {}
+    @path.glob.each {|glob| add_glob(snap, glob)}
+    @snapshot = snap
+  end
+  
+  def add_glob(snap, glob)
+    Pathname.glob(@path.to_pathname.join(glob)).each do |fn|
+      next unless fn.file?
+      snap["#{fn}"] = fn.mtime
+    end
+  end
+  
+end
diff --git a/lib/vendor/fssm/support.rb b/lib/vendor/fssm/support.rb
new file mode 100644
index 0000000000..fe6aa8969a
--- /dev/null
+++ b/lib/vendor/fssm/support.rb
@@ -0,0 +1,26 @@
+module FSSM::Support
+  class << self
+    # def backend
+    #   (mac? && carbon_core?) ? 'FSEvents' : 'Polling'
+    # end
+    
+    def backend
+      'Polling'
+    end
+    
+    def mac?
+      @@mac ||= RUBY_PLATFORM =~ /darwin/i
+    end
+    
+    def carbon_core?
+      @@carbon_core ||= begin
+        require 'osx/foundation'
+        OSX.require_framework '/System/Library/Frameworks/CoreServices.framework/Frameworks/CarbonCore.framework'
+        true
+      rescue LoadError
+        false
+      end
+    end
+
+  end
+end