<p>The River Chief System (RCS) plays a crucial role as the core system in the comprehensive management of China’s watershed water environment. However, the current system design center of the RCS still focuses on the responsibility system of Party and government leaders, and the mechanism for ensuring social public participation still needs to be improved, especially the discourse power of peasant households along the river that are directly interest-related to the watershed water environment is relatively weak. With the advancement of society and the awakening of environmental awareness among peasant households, there is a need to improve mechanisms for peasant households’ participation to facilitate the further development of the RCS. This article focuses on exploring the necessity of integrating the RCS with the participation of peasant households, analyzing the shortcomings of current peasant households’ participation in watershed water environment governance, and comparing typical cases, then proposing improvement directions, intending to fully integrate the RCS with peasant households’ participation and form a healthy development, thereby enhancing the effectiveness of governance. The specific path includes: relying on the current institutional achievements of the RCS, constructing and enhancing the participation mechanism for peasant households along the river, defining the basic responsibilities of peasant households’ participation in the RCS to clarify the power boundary, establishing eight main contents for peasant households to participate in the RCS, and establishing corresponding reward and punishment performance evaluation systems.</p>