Sensors are increasingly being employed to determine different activities of a person living at home. Numerous sensors can be used to obtain a variety of information. While many sensors may be used to make a system, it is important to look into the availability, cost, installation, mechanism, and performance of sensors. This chapter investigates different sensors and their usefulness in a smart home monitoring system. A smart home monitoring system provides a safe, sound, and secure living environment for elderly people. Statistics show that the population of elderly people is increasing around the world and this trend is not going to change in the near future. The authors have developed a smart home that consists of an optimum number of wireless sensors that includes current flow, water flow, and bed usage sensors. The sensors provide information that can be used for monitoring elderly people by detecting abnormal patterns in their daily activities. The system generates and sends an early warning message to the caregiver when an unforeseen abnormal condition occurs.