The purpose of operating a radar system multistatically is to acquire information about targets of interest more quickly and reliably than would be possible using disparate radars, which fuse data and track post‐detection. This paper identifies and addresses the critical issues for designing a coherent multistatic radar system using conventional coherent radars and proposes a set of design principles for configuring a coherent multistatic radar network with the aim of maximising the utility of information while constraining system cost and complexity. The issues discussed are as follows: the localisation of targets in three dimensions; eliminating the inevitable spatial ambiguities arising from sparse spatial sampling while exploiting the large aperture for high resolution; the achievement of spatial coherent processing gain for target detection; the effect of phase centre localisation, phase and frequency errors on synchronisation; the incorporation of three‐dimensional Doppler estimation for slow‐time coherent integration. The arguments presented are physically‐based and complemented by mathematical analysis and numerical experimentation using non‐linear sparse estimation, the sparse algorithm being critically important for resolving spatial ambiguities. An optimal configuration is identified, which has sufficiently many nodes to overcome spatial ambiguities and achieves significant spatial coherent processing gain, while simultaneously constraining the overheads of inter‐node synchronisation and communication.