Environmental monitoring is the basis of the whole environmental management system，so improvement of environmental monitoring function is the basis of capacity building of environmental management system. This paper is trying to find out what obstructs Shanghai’s environmental monitoring system from playing the basic role through analyzing its status quo，based on which suggestions for improvement strategies will be put forward. Although Shanghai has achieved a lot in building up environmental monitoring system，some problems remain to be solved：The environmental monitoring agency affiliated to the environmental authority will face governmental interference；The environmental authority has no right to manage and utilize non-governmental environmental monitoring agencies and those affiliated to other governmental departments；The arrangement of monitoring sites fails to truly reflect the impacts on citizens’ health；Environmental monitoring information is not adequately open，hindering utilization of its scientific value；The third-party environmental monitoring market is not well regulated and utilized. To solve these problems，this paper suggests to：Turn the monitoring agency affiliated to the environmental authority to the environmental monitoring authority independent from the environmental authority，and even relatively independent from the Administration；Authorize the environmental monitoring authority to manage all the environmental monitoring agencies in the jurisdiction and to utilize their information；Arrange monitoring sites to truly reflect the adverse effects to human health；Open more environmental monitoring information to make good use of its scientific value；Nurture and regulate the third-party environmental monitoring market，and purchase environmental monitoring services from it.