To enhance the understanding of the integrity and complexity of watershed systems and the challenges they face, this study elucidates the integrity of watershed systems from the perspective of the cascading relationships between the physical- and human-geographical characteristics of five major units—the headwaters, upper reaches, middle reaches, lower reaches, and estuary—based on their linkages in hydrology and sediment transport, topography and geomorphology, nutrients, and ecological elements. Drawing on the characteristics of the interaction mechanisms among internal elements and subsystems, the inherent contradictions underlying the complexity and difficulty of watershed-system governance are examined. From the perspective of interactions among the Earth’s spheres, the external pressures imposed on watershed systems governance by the atmosphere, lithosphere, anthroposphere, and biosphere are analysed. Finally, the challenges to the sustainable operation of watershed systems in the Anthropocene are summarized, including climate change, technological development, policies and regulations, and the international situation. Considering the integrity of the watershed system and the challenges arising from both internal and external factors, key research directions are proposed to ensure the sustainable operation of watershed systems. These directions include establishing a theoretical framework for sustainable watershed system operation based on the cascading relationships among five units, identifying the critical thresholds governing regime shifts in the relationships among watershed system elements and subsystems, and development a watershed system simulator that integrates holistic and reductionist approaches.