This paper provides an overview of the implementation and obstacles of watershed management, and the alternative solutions based on a synoptic review of related studies and experiences across Indonesia. The review found that problems in the institutional aspect were hierarchical confusion, discrepancy, and asynchrony among regulations, and weak (participation, synchronization, and coordination) among watershed management stakeholders. The weaknesses in the planning stage are integration among sectors, a lack of community participation, and limited readiness to integrate watershed planning into regional planning. Stakeholders’ involvement is also a critical factor in successful implementation of degraded watershed rehabilitation, including in peatland and mangrove areas. Failure should be minimized by providing adequate information on degraded watershed characteristics, appropriate species choices, and effective mechanical construction for soil and water conservation. Community participation as the main factor in driving watershed management should be achieved by strengthening public awareness of the importance of a sustainable watershed and providing access for the community to be involved in each stage of watershed management. Another problem is data gaps which are essential to address from the planning to evaluation stages. The gaps can be bridged by using remotely sensed data and by applying hydrological-based simulation models. Simplified criteria for watershed assessment may also be required, depending on site-specific issues and the watershed scale.