diff --git a/.rubocop.yml b/.rubocop.yml
index e09e54a..d5daca2 100644
--- a/.rubocop.yml
+++ b/.rubocop.yml
@@ -48,6 +48,10 @@ Layout/MultilineMethodCallIndentation:
 Layout/SpaceAroundEqualsInParameterDefault:
   EnforcedStyle: no_space
 
+Lint/EmptyFile:
+  Exclude:
+    - "test/fixtures/**/*"
+
 Metrics/AbcSize:
   Max: 20
   Exclude:
diff --git a/lib/mighty_test.rb b/lib/mighty_test.rb
index d20b6fe..e1d62d7 100644
--- a/lib/mighty_test.rb
+++ b/lib/mighty_test.rb
@@ -1,7 +1,9 @@
 module MightyTest
   autoload :VERSION, "mighty_test/version"
   autoload :CLI, "mighty_test/cli"
+  autoload :FileSystem, "mighty_test/file_system"
   autoload :MinitestRunner, "mighty_test/minitest_runner"
   autoload :OptionParser, "mighty_test/option_parser"
   autoload :TestParser, "mighty_test/test_parser"
+  autoload :Watcher, "mighty_test/watcher"
 end
diff --git a/lib/mighty_test/cli.rb b/lib/mighty_test/cli.rb
index 551c40a..5f08a32 100644
--- a/lib/mighty_test/cli.rb
+++ b/lib/mighty_test/cli.rb
@@ -13,6 +13,8 @@ def run(argv: ARGV)
         print_help
       elsif options[:version]
         puts VERSION
+      elsif options[:watch]
+        watch
       elsif path_args.grep(/.:\d+$/).any?
         run_test_by_line_number
       else
@@ -33,6 +35,10 @@ def print_help
       runner.print_help_and_exit!
     end
 
+    def watch
+      Watcher.new(extra_args:).run
+    end
+
     def run_test_by_line_number
       path, line = path_args.first.match(/^(.+):(\d+)$/).captures
       test_name = TestParser.new(path).test_name_at_line(line.to_i)
diff --git a/lib/mighty_test/file_system.rb b/lib/mighty_test/file_system.rb
new file mode 100644
index 0000000..222cc9f
--- /dev/null
+++ b/lib/mighty_test/file_system.rb
@@ -0,0 +1,16 @@
+module MightyTest
+  class FileSystem
+    def listen(&)
+      require "listen"
+      Listen.to(*%w[app lib test].select { |p| Dir.exist?(p) }, relative: true, &).tap(&:start)
+    end
+
+    def find_matching_test_file(path)
+      return nil unless path && File.exist?(path) && !Dir.exist?(path)
+      return path if path.match?(%r{^test/.*_test.rb$})
+
+      test_path = path[%r{^(?:app|lib)/(.+)\.[^\.]+$}, 1].then { "test/#{_1}_test.rb" }
+      test_path if test_path && File.exist?(test_path)
+    end
+  end
+end
diff --git a/lib/mighty_test/option_parser.rb b/lib/mighty_test/option_parser.rb
index f107214..d79b380 100644
--- a/lib/mighty_test/option_parser.rb
+++ b/lib/mighty_test/option_parser.rb
@@ -1,15 +1,17 @@
+require "optparse"
+
 module MightyTest
   class OptionParser
     def initialize
-      require "optparse"
-
       @parser = ::OptionParser.new do |op|
         op.require_exact = true
         op.banner = <<~BANNER
           Usage: mt <test file>...
+                 mt --watch
 
         BANNER
 
+        op.on("--watch") { options[:watch] = true }
         op.on("-h", "--help") { options[:help] = true }
         op.on("--version") { options[:version] = true }
       end
diff --git a/lib/mighty_test/watcher.rb b/lib/mighty_test/watcher.rb
new file mode 100644
index 0000000..16c4827
--- /dev/null
+++ b/lib/mighty_test/watcher.rb
@@ -0,0 +1,71 @@
+require "concurrent"
+
+module MightyTest
+  class Watcher
+    WATCHING_FOR_CHANGES = "Watching for changes to source and test files. Press ctrl-c to exit.".freeze
+
+    def initialize(extra_args: [], file_system: FileSystem.new, system_proc: method(:system))
+      @event = Concurrent::MVar.new
+      @extra_args = extra_args
+      @file_system = file_system
+      @system_proc = system_proc
+    end
+
+    def run(iterations: :indefinitely)
+      start_listener
+      puts WATCHING_FOR_CHANGES
+
+      loop_for(iterations) do
+        case await_next_event
+        in [:file_system_changed, paths]
+          mt(*paths) if paths.any?
+        in [:tests_completed, :pass | :fail]
+          puts WATCHING_FOR_CHANGES
+        end
+      end
+    ensure
+      listener&.stop
+    end
+
+    private
+
+    attr_reader :extra_args, :file_system, :listener, :system_proc
+
+    def mt(*test_paths)
+      success = system_proc.call("mt", *extra_args, "--", *test_paths.flatten)
+      post_event(:tests_completed, success ? :pass : :fail)
+    rescue Interrupt
+      # Pressing ctrl-c kills the fs_event background process, so we have to manually restart it.
+      restart_listener
+    end
+
+    def start_listener
+      listener.stop if listener && !listener.stopped?
+
+      @listener = file_system.listen do |modified, added, _removed|
+        # Pause listener so that subsequent changes are queued up while we are running the tests
+        listener.pause unless listener.stopped?
+
+        test_paths = [*modified, *added].filter_map do |path|
+          file_system.find_matching_test_file(path)
+        end
+
+        post_event(:file_system_changed, test_paths.uniq)
+      end
+    end
+    alias restart_listener start_listener
+
+    def loop_for(iterations, &)
+      iterations == :indefinitely ? loop(&) : iterations.times(&)
+    end
+
+    def await_next_event
+      listener.start if listener.paused?
+      @event.take
+    end
+
+    def post_event(*event)
+      @event.put(event)
+    end
+  end
+end
diff --git a/mighty_test.gemspec b/mighty_test.gemspec
index 210f59c..624ef9a 100644
--- a/mighty_test.gemspec
+++ b/mighty_test.gemspec
@@ -26,6 +26,8 @@ Gem::Specification.new do |spec|
   spec.require_paths = ["lib"]
 
   # Runtime dependencies
+  spec.add_dependency "concurrent-ruby", "~> 1.1"
+  spec.add_dependency "listen", "~> 3.5"
   spec.add_dependency "minitest", "~> 5.15"
   spec.add_dependency "minitest-fail-fast", "~> 0.1.0"
   spec.add_dependency "minitest-focus", "~> 1.4"
diff --git a/test/fixtures/rails_project/app/models/user.rb b/test/fixtures/rails_project/app/models/user.rb
new file mode 100644
index 0000000..e69de29
diff --git a/test/fixtures/rails_project/test/models/user_test.rb b/test/fixtures/rails_project/test/models/user_test.rb
new file mode 100644
index 0000000..e69de29
diff --git a/test/integration/mt_test.rb b/test/integration/mt_test.rb
index 370a74e..fa02c2f 100644
--- a/test/integration/mt_test.rb
+++ b/test/integration/mt_test.rb
@@ -57,6 +57,28 @@ def test_mt_runs_no_tests_if_line_number_doesnt_match
       refute_match(/FailingTest/, result.stdout)
     end
 
+    def test_mt_runs_watch_mode_that_executes_tests_when_files_change
+      project_dir = fixtures_path.join("example_project")
+      stdout, = capture_subprocess_io do
+        # Start mt --watch in the background
+        pid = spawn(*%w[bundle exec mt --watch --verbose], chdir: project_dir)
+
+        # mt needs time to launch and start its file system listener
+        sleep 1
+
+        # Touch a file and wait for mt --watch to detect the change and run the corresponding test
+        FileUtils.touch project_dir.join("lib/example.rb")
+        sleep 1
+
+        # OK, we're done here. Tell mt --watch to exit.
+        Process.kill(:INT, pid)
+      end
+
+      assert_includes(stdout, "Watching for changes to source and test files.")
+      assert_match(/ExampleTest/, stdout)
+      assert_match(/\d runs, \d assertions, 0 failures, 0 errors/, stdout)
+    end
+
     private
 
     def bundle_exec_mt(argv:, env: { "CI" => nil }, chdir: nil, raise_on_failure: true)
diff --git a/test/mighty_test/file_system_test.rb b/test/mighty_test/file_system_test.rb
new file mode 100644
index 0000000..6d7b6da
--- /dev/null
+++ b/test/mighty_test/file_system_test.rb
@@ -0,0 +1,50 @@
+require "test_helper"
+
+module MightyTest
+  class FileSystemTest < Minitest::Test
+    include FixturesPath
+
+    def test_find_matching_test_file_returns_nil_for_nil_path
+      assert_nil find_matching_test_file(nil)
+    end
+
+    def test_find_matching_test_file_returns_nil_for_non_existent_path
+      assert_nil find_matching_test_file("path/to/nowhere.rb")
+    end
+
+    def test_find_matching_test_file_returns_nil_for_directory_path
+      assert_nil find_matching_test_file("lib/example", in: fixtures_path.join("example_project"))
+    end
+
+    def test_find_matching_test_file_returns_nil_for_path_with_no_corresponding_test
+      assert_nil find_matching_test_file("lib/example/version.rb", in: fixtures_path.join("example_project"))
+    end
+
+    def test_find_matching_test_file_returns_nil_for_a_test_support_file
+      assert_nil find_matching_test_file("test/test_helper.rb", in: fixtures_path.join("example_project"))
+    end
+
+    def test_find_matching_test_file_returns_argument_if_it_is_already_a_test
+      test_path = find_matching_test_file("test/example_test.rb", in: fixtures_path.join("example_project"))
+      assert_equal("test/example_test.rb", test_path)
+    end
+
+    def test_find_matching_test_file_returns_matching_test_given_an_implementation_path_in_a_gem_project
+      test_path = find_matching_test_file("lib/example.rb", in: fixtures_path.join("example_project"))
+      assert_equal("test/example_test.rb", test_path)
+    end
+
+    def test_find_matching_test_file_returns_matching_test_given_a_model_path_in_a_rails_project
+      test_path = find_matching_test_file("app/models/user.rb", in: fixtures_path.join("rails_project"))
+      assert_equal("test/models/user_test.rb", test_path)
+    end
+
+    private
+
+    def find_matching_test_file(path, in: ".")
+      Dir.chdir(binding.local_variable_get(:in)) do
+        FileSystem.new.find_matching_test_file(path)
+      end
+    end
+  end
+end
diff --git a/test/mighty_test/watcher_test.rb b/test/mighty_test/watcher_test.rb
new file mode 100644
index 0000000..bf4c41c
--- /dev/null
+++ b/test/mighty_test/watcher_test.rb
@@ -0,0 +1,133 @@
+require "test_helper"
+
+module MightyTest
+  class WatcherTest < Minitest::Test
+    include FixturesPath
+
+    def test_watcher_passes_unique_set_of_test_files_to_mt_command_based_on_changes_detected
+      system_proc { |*args| puts "[SYSTEM] #{args.join(' ')}" }
+      listen_thread do |callback|
+        callback.call(["lib/example.rb", "test/focused_test.rb"], ["test/focused_test.rb"], [])
+      end
+
+      stdout, = run_watcher(iterations: 1, in: fixtures_path.join("example_project"))
+
+      assert_includes(stdout, "[SYSTEM] mt -- test/example_test.rb test/focused_test.rb\n")
+    end
+
+    def test_watcher_does_nothing_if_a_detected_change_has_no_corresponding_test_file
+      system_proc { |*args| puts "[SYSTEM] #{args.join(' ')}" }
+      listen_thread do |callback|
+        callback.call(["lib/example/version.rb"], [], [])
+      end
+
+      stdout, = run_watcher(iterations: 1, in: fixtures_path.join("example_project"))
+
+      refute_includes(stdout, "[SYSTEM]")
+    end
+
+    def test_watcher_passes_extra_args_through_to_mt_command
+      system_proc { |*args| puts "[SYSTEM] #{args.join(' ')}" }
+      listen_thread do |callback|
+        callback.call(["test/example_test.rb"], [], [])
+      end
+
+      stdout, = run_watcher(iterations: 1, extra_args: ["--fail-fast"], in: fixtures_path.join("example_project"))
+
+      assert_includes(stdout, "[SYSTEM] mt --fail-fast -- test/example_test.rb\n")
+    end
+
+    def test_watcher_prints_a_status_message_after_successful_test_run
+      system_proc do |*args|
+        puts "[SYSTEM] #{args.join(' ')}"
+        true
+      end
+      listen_thread do |callback|
+        callback.call(["test/example_test.rb"], [], [])
+      end
+
+      stdout, = run_watcher(iterations: 2, in: fixtures_path.join("example_project"))
+
+      assert_includes(stdout, <<~EXPECTED)
+        [SYSTEM] mt -- test/example_test.rb
+        Watching for changes to source and test files. Press ctrl-c to exit.
+      EXPECTED
+    end
+
+    def test_watcher_prints_a_status_message_after_failed_test_run
+      system_proc do |*args|
+        puts "[SYSTEM] #{args.join(' ')}"
+        false
+      end
+      listen_thread do |callback|
+        callback.call(["test/example_test.rb"], [], [])
+      end
+
+      stdout, = run_watcher(iterations: 2, in: fixtures_path.join("example_project"))
+
+      assert_includes(stdout, <<~EXPECTED)
+        [SYSTEM] mt -- test/example_test.rb
+        Watching for changes to source and test files. Press ctrl-c to exit.
+      EXPECTED
+    end
+
+    def test_watcher_restarts_the_listener_when_a_test_run_is_interrupted
+      thread_count = 0
+      system_proc { |*| raise Interrupt }
+      listen_thread do |callback|
+        thread_count += 1
+        callback.call(["test/example_test.rb"], [], []) unless thread_count > 2
+      end
+
+      run_watcher(iterations: 2, in: fixtures_path.join("example_project"))
+      assert_equal(2, thread_count)
+    end
+
+    private
+
+    class Listener
+      def initialize(thread, callback)
+        Thread.new do
+          thread.call(callback)
+        end
+      end
+
+      def start
+      end
+
+      def stop
+      end
+
+      def pause
+      end
+
+      def stopped?
+        false
+      end
+
+      def paused?
+        false
+      end
+    end
+
+    def run_watcher(iterations:, in: ".", extra_args: [])
+      listen_thread = @listen_thread
+      file_system = FileSystem.new
+      file_system.define_singleton_method(:listen) { |&callback| Listener.new(listen_thread, callback) }
+      capture_io do
+        Dir.chdir(binding.local_variable_get(:in)) do
+          @watcher = Watcher.new(extra_args:, file_system:, system_proc: @system_proc)
+          @watcher.run(iterations:)
+        end
+      end
+    end
+
+    def listen_thread(&thread)
+      @listen_thread = thread
+    end
+
+    def system_proc(&proc)
+      @system_proc = proc
+    end
+  end
+end