I have had problem with my SASS-styles not being compiled automatically when I change a partial file, so first I got help from @chriseppstein, Sass Core Developer via Twitter suggesting I should watch the directory instead of the file. Then I ran into this:

sass --watch public_html/css
>>> Sass is watching for changes. Press Ctrl-C to stop.
  overwrite public_html/css/style.css
/Library/[...]/fsevents.rb:27: [BUG] Segmentation fault
ruby 1.8.7 (2010-01-10 patchlevel 249) [universal-darwin11.0]

@chriseppstein suggested I try to reinstall fsevents, I did not get that to work so I searched some more, and found this resource suggesting running this command:

gem install fssm
 

When that has finished and you start watching a folder you get promted to:

FSSM -> An optimized backend is available for this platform!
FSSM ->     gem install rb-fsevent

So, just do what you are told

gem install rb-fsevent

Now it works. Thanks for helping. Just putting this down for people experience the same issues (and myself when I have forgot the solution)