A major remaining way to improve operational effectiveness for compressor stations is by the combination of on-line monitoring and enhanced diagnostics which can be described by the general term ‘smart monitoring’. The introduction of smart monitoring techniques will allow unattended operation of equipment to a greater extent than has been possible so far with remote access to the monitoring and diagnostic information from remote field, maintenance, and gas control locations. On-site attendance by operating and maintenance personnel can then be limited to responding to unscheduled events and for doing routine and scheduled maintenance. The role of enhanced diagnostics in this context is to anticipate undesirable operating conditions (and possibly mitigate or avoid them by certain control actions), to obtain earlier prediction of equipment deterioration or potential failures, to carry out a detailed analysis of unscheduled events and shutdowns, and to enable a high level of on-condition maintenance. The function of the intelligent diagnostics is to convert monitoring data, which can be voluminous with online monitoring, into a reduced subset of relevant information which is needed to make decisions. In this paper, a conceptual approach to smart monitoring is described and initial results of an on-site prototype are presented. Future implementation issues are also discussed.