There are well-known, substantial concerns that peoples' uses of water may significantly alter the quantity and quality of water-cycle processes at the local and regional scales. Addressing these concerns requires a substantially better understanding of the linkages and feedback between the various systems than presently is available. Although many studies have examined human-water dynamics, the complexity of such coupled systems is not well understood as, among other causes, the data and tools for multidisciplinary natural scale studies are not available yet. The recent information and communication technology advancements, collectively labeled as informatics (or hydroinformatics for the water-related domain), enable to address a new class of problems around the organization of data and information leading to knowledge extraction. Hydroinformatics embraces not only methods of data capture, storage, processing, analysis and graphical display, but the use of advanced modeling, optimization, knowledge-based tools and computational infrastructure (cyberinfrastructure). This paper discusses the initiation of the cyberinfrastructure-based Upper Mississippi River Basin Observatory (UMRBO). The observatory would consist of a number of interdisciplinary, multi-institutional teams synergistically collaborating on a series of research sites at different locations within the basin. There is no existing recipe to establishing an observatory at this time, however, there is a vast amount of experience and knowledge that can be shared to help establish an observatory. Building an observatory should be a collaborative, inclusive and equitable process and could be used to establish a practical problem solving agenda linking the abundance of research carried out in the Upper Mississippi River Basin to the needs of mission agencies and stakeholders within the basin. In order to begin the process, a workshop was held, in which an international team of research scientists and practitioners came together to discuss how the process could become a reality.