Participant observation as data collection method in nursing research is explored in this article. The scientific basis of observation method comes from symbolic interactionism. Nature and epistemological starting points of the knowledge produced by observational method can vary depending on the purpose of the study. Participant observation is a process, which aims at scientific research through observer's presence in social situations. Fieldwork should be carefully prepared because the main problem in participant observation is observer's influence on phenomenon which is being studied. In the beginning of the field-work researcher tries to get a general view what happens in the situation. After the analysis the researcher can focus his observations according to his research problems and finally observe selectively. The data consists of record-keeping, descriptions and field-work note book. Participant observation is the most subjective observation method of data collection. By using triangulation a researcher can avoid his personal influence on results and make the validity of his study better. The researcher must take ethical issues into consideration when collecting data by participant observation.