This paper demonstrates improved retrieval of snow water equivalent (SWE) from spaceborne passive microwave measurements for the sparsely forested Upper Kern watershed (511 km2) in the southern Sierra Nevada (USA). This is accomplished by assimilating AMSR‐E 36.5 GHz measurements into model predictions of SWE at 90 m spatial resolution using the Ensemble Batch Smoother (EnBS) data assimilation framework. For each water year (WY) from 2003 to 2008, SWE was estimated for the accumulation season (1 October to 1 April) with the assimilation of the measurements in the dry snow season (1 December to 28 February). The EnBS SWE estimation was validated against snow courses and snow pillows. On average, the EnBS accumulation season SWE RMSE was 77.4 mm (13.1%, relative to peak accumulation), despite deep snow (average peak SWE of 545 mm). The prior model estimate without assimilation had an accumulation season average RMSE of 119.7 mm. After assimilation, the overall bias of the accumulation season SWE estimates was reduced by 84.2%, and the RMSE reduced by 35.4%. The assimilation also reduced the bias and the RMSE of the 1 April SWE estimates by 80.9% and 45.4%, respectively. The EnBS is expected to work well above tree line and for dry snow.