By appropriate integration of advanced ICT systems in an environment, in a way that those highly technological systems become almost its integral part, it is possible to provide additional environment features. Those features are primarily self-monitoring and self-protection, giving the environment rudimentary intelligence and possibility, to operate not only by reaction, but also to operate proactively, having in "mind" its self-protection. In such a way the environment becomes the intelligent environment or more accurately the intelligent self-monitoring, self-protecting and self-aware environment that reacts on changes and in real time alarms humans responsible for appropriate environment protection actions which will prevent environment further degradation. The paper describes overall architecture of such intelligent environment based on advanced sensor network called the observer network. As an example the system architecture of the forest fire monitoring system is discussed.