definition 1: to perceive; see.
example: She observed that he was wearing his best suit.
definition 2: to watch closely or make a systematic observation of.
example: She likes to sit by the window and observe the people walking by.
example: The students observed the entire operation performed by the heart surgeon.
example: The scientists are observing the animal’s behavior in its own habitat.
definition 3: to remark casually
example: “You look cheerful today,” he observed.
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Note on use
The first definition of “observe” is “to perceive; see,” but observing is more than simple seeing. When you observe something, you see it and make a mental note of it, and what you observe tends to be something that others in the same situation might not notice at all. Usually, a thing that is observed is of a certain significance or interest to the particular observer. Also, notice that the word “observe” in this meaning can be followed by a clause beginning with “that.”