diff --git a/CHANGELOG.md b/CHANGELOG.md
index 1136136f8..c95972da3 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -39,6 +39,9 @@ app/javascript/packs/hello.vue
 - Add initial test case by @kimquy [#259](https://github.com/rails/webpacker/pull/259)
 
 
+### Removed
+- Webpack watcher - [#295](https://github.com/rails/webpacker/pull/295)
+
 ## [1.1] - 2017-03-24
 
 This release requires you to run below commands to install new features.
diff --git a/README.md b/README.md
index 9ce90b3f7..3c21f10ff 100644
--- a/README.md
+++ b/README.md
@@ -39,17 +39,13 @@ You can also see a list of available commands by running `./bin/rails webpacker`
 
 ## Binstubs
 
-Webpacker ships with three binstubs: `./bin/webpack`, `./bin/webpack-watcher` and `./bin/webpack-dev-server`.
-They're thin wrappers around the standard webpack.js executable, just to ensure that the right configuration
-file is loaded.
-
+Webpacker ships with two binstubs: `./bin/webpack` and `./bin/webpack-dev-server`.
+They're thin wrappers around the standard webpack.js executable, just to ensure that the right configuration file is loaded depending on your environment.
 
 A binstub is also created to install your npm dependencies,
 and can be called via `./bin/yarn`.
 
-In development, you'll need to run either `./bin/webpack-dev-server` or `./bin/webpack-watcher` in a separate terminal from `./bin/rails server` to have your `app/javascript/packs/*.js` files compiled as you make changes. If you'd rather not have to run the two processes separately by hand, you can use [Foreman](https://ddollar.github.io/foreman). `./bin/webpack-dev-server` launches the [Webpack Dev Server](https://webpack.js.org/configuration/dev-server/), which serves your pack files on http://localhost:8080/, and provides advanced Webpack features, such as [Hot Module Replacement](https://webpack.js.org/guides/hmr-react/).
-
-If you would rather forego the advanced features and serve your javascript packs directly from the rails server, you may use `./bin/webpack-watcher` instead, but make sure to disable the Dev Server in `config/webpack/development.server.yml`, otherwise script tags will keep pointing to `localhost:8080` and won't load properly.
+In development, you'll need to run `./bin/webpack-dev-server` in a separate terminal from `./bin/rails server` to have your `app/javascript/packs/*.js` files compiled as you make changes. If you'd rather not have to run the two processes separately by hand, you can use [Foreman](https://ddollar.github.io/foreman). `./bin/webpack-dev-server` launches the [Webpack Dev Server](https://webpack.js.org/configuration/dev-server/), which serves your pack files on http://localhost:8080/, and provides advanced Webpack features, such as [Hot Module Replacement](https://webpack.js.org/guides/hmr-react/).
 
 ## Configuration
 
@@ -135,11 +131,6 @@ port: 8080
 By default, `webpack-dev-server` uses `output` option specified in
 `paths.yml` as `contentBase`.
 
-**Note:** Don't forget to disable `webpack-dev-server` in case you are using
-`./bin/webpack-watcher` to serve assets in development mode otherwise
-you will get 404 for assets because the helper tag will use webpack-dev-server url
-to serve assets instead of public directory.
-
 ## Linking to static assets
 
 Static assets like images, fonts and stylesheets support is enabled out-of-box so, you can link them into your javascript app code and have them compiled automatically.
@@ -240,7 +231,7 @@ Webpacker uses a `manifest.json` file to keep track of packs in all environments
 however since this file is generated after packs are compiled by webpack. So,
 if you load a view in browser whilst webpack is compiling you will get this error.
 Therefore, make sure webpack
-(i.e `./bin/webpack-watcher` or `./bin/webpack-dev-server`) is running and has
+(i.e `./bin/webpack-dev-server`) is running and has
 completed the compilation successfully before loading a view.
 
 ## Wishlist
diff --git a/lib/install/bin/webpack-dev-server.tt b/lib/install/bin/webpack-dev-server.tt
index b7cfbca6f..368cbb054 100644
--- a/lib/install/bin/webpack-dev-server.tt
+++ b/lib/install/bin/webpack-dev-server.tt
@@ -29,5 +29,5 @@ end
 
 Dir.chdir(APP_PATH) do
   exec "NODE_PATH=#{NODE_MODULES_PATH} #{WEBPACK_BIN} --progress --color " \
-    "--config #{DEV_SERVER_CONFIG}"
+    "--config #{DEV_SERVER_CONFIG} #{ARGV.join(" ")}"
 end
diff --git a/lib/install/bin/webpack-watcher.tt b/lib/install/bin/webpack-watcher.tt
deleted file mode 100644
index fa83972f7..000000000
--- a/lib/install/bin/webpack-watcher.tt
+++ /dev/null
@@ -1,10 +0,0 @@
-<%= shebang %>
-
-ENV['RAILS_ENV'] ||= 'development'
-ENV['NODE_ENV'] ||= ENV['RAILS_ENV']
-
-BIN_PATH = File.expand_path('.', __dir__)
-
-Dir.chdir(BIN_PATH) do
-  exec "./webpack --watch --progress --color #{ARGV.join(" ")}"
-end
diff --git a/lib/install/bin/webpack.tt b/lib/install/bin/webpack.tt
index 6b11c4aeb..cc302b8af 100644
--- a/lib/install/bin/webpack.tt
+++ b/lib/install/bin/webpack.tt
@@ -12,21 +12,14 @@ NODE_ENV    = ENV["NODE_ENV"]
 
 APP_PATH               = File.expand_path("../", __dir__)
 CONFIG_PATH            = File.join(APP_PATH, "config/webpack/paths.yml")
-DEV_SERVER_CONFIG_PATH = File.join(APP_PATH, "config/webpack/development.server.yml")
 
 begin
   paths            = YAML.load(File.read(CONFIG_PATH))[NODE_ENV]
-  dev_server       = YAML.load(File.read(DEV_SERVER_CONFIG_PATH))[NODE_ENV]
 
   NODE_MODULES_PATH   = File.join(APP_PATH.shellescape, paths["node_modules"])
   WEBPACK_CONFIG_PATH = File.join(APP_PATH.shellescape, paths["config"])
-
-  if NODE_ENV == "development" && dev_server["enabled"]
-    puts "Warning: webpack-dev-server is currently enabled in #{DEV_SERVER_CONFIG_PATH}. " \
-      "Disable to serve assets directly from public/packs directory"
-  end
 rescue Errno::ENOENT, NoMethodError
-  puts "Configuration not found in config/webpack/paths.yml or config/webpack/development.server.yml."
+  puts "Configuration not found in config/webpack/paths.yml"
   puts "Please run bundle exec rails webpacker:install to install webpacker"
   exit!
 end
diff --git a/lib/install/config/webpack/configuration.js b/lib/install/config/webpack/configuration.js
index 904af8229..c8f8461ab 100644
--- a/lib/install/config/webpack/configuration.js
+++ b/lib/install/config/webpack/configuration.js
@@ -14,7 +14,7 @@ const devServer = safeLoad(readFileSync(join(configPath, 'development.server.yml
 const ifHasCDN = env.ASSET_HOST !== undefined && env.NODE_ENV === 'production'
 const devServerUrl = `http://${devServer.host}:${devServer.port}/${paths.entry}/`
 const publicUrl = ifHasCDN ? `${env.ASSET_HOST}/${paths.entry}/` : `/${paths.entry}/`
-const publicPath = env.NODE_ENV !== 'production' && devServer.enabled ? devServerUrl : publicUrl
+const publicPath = env.NODE_ENV !== 'production' ? devServerUrl : publicUrl
 
 module.exports = {
   devServer,
diff --git a/lib/install/template.rb b/lib/install/template.rb
index bc4925cc3..18e18ed26 100644
--- a/lib/install/template.rb
+++ b/lib/install/template.rb
@@ -12,7 +12,6 @@
 
 puts "Copying binstubs"
 template "#{__dir__}/bin/webpack-dev-server", "bin/webpack-dev-server"
-template "#{__dir__}/bin/webpack-watcher", "bin/webpack-watcher"
 template "#{__dir__}/bin/webpack", "bin/webpack"
 
 if !File.exist?("bin/yarn")