A groundwater observational network for monitoring seismic precursors has been established at the reservoirs on the lower reaches of the Jinsha River in southwestern China, where a series of hydropower stations are under construction. It is the second network in China that is operated by enterprises with the purpose to observe and study earthquake precursors in reservoir areas. This paper presents the layout and technical constitution of the network, features of its observational wells and aquifers and the preliminary result of its experimental operation. Its capability to monitor seismic precursor is evaluated based on an analysis of the well-aquifer system as well as the multiple- monthly, monthly, daily and hourly variations of water levels and water temperatures observed by this network.