diff --git a/src/reactivity/reactive.ts b/src/reactivity/reactive.ts
index 4cc72803..38469e2e 100644
--- a/src/reactivity/reactive.ts
+++ b/src/reactivity/reactive.ts
@@ -101,7 +101,7 @@ export function defineAccessControl(target: AnyObject, key: any, val?: any) {
   })
 }
 
-function observe<T>(obj: T): T {
+export function observe<T>(obj: T): T {
   const Vue = getRegisteredVueOrDefault()
   let observed: T
   if (Vue.observable) {
diff --git a/src/reactivity/readonly.ts b/src/reactivity/readonly.ts
index dc4bcbd0..e223c91d 100644
--- a/src/reactivity/readonly.ts
+++ b/src/reactivity/readonly.ts
@@ -1,7 +1,8 @@
 import { reactive, Ref, UnwrapRef } from '.'
 import { isArray, isPlainObject, warn } from '../utils'
 import { readonlySet } from '../utils/sets'
-import { isRef } from './ref'
+import { isReactive, observe } from './reactive'
+import { isRef, RefImpl } from './ref'
 
 export function isReadonly(obj: any): boolean {
   return readonlySet.has(obj)
@@ -55,8 +56,11 @@ export function shallowReadonly(obj: any): any {
     return obj
   }
 
-  const readonlyObj = {}
-
+  const readonlyObj = isRef(obj)
+    ? new RefImpl({} as any)
+    : isReactive(obj)
+    ? observe({})
+    : {}
   const source = reactive({})
   const ob = (source as any).__ob__
 
@@ -64,8 +68,8 @@ export function shallowReadonly(obj: any): any {
     let val = obj[key]
     let getter: (() => any) | undefined
     const property = Object.getOwnPropertyDescriptor(obj, key)
-    if (property && !isRef(obj)) {
-      if (property.configurable === false) {
+    if (property) {
+      if (property.configurable === false && !isRef(obj)) {
         continue
       }
       getter = property.get
diff --git a/src/reactivity/ref.ts b/src/reactivity/ref.ts
index ccef2a8b..ce8458ac 100644
--- a/src/reactivity/ref.ts
+++ b/src/reactivity/ref.ts
@@ -71,7 +71,7 @@ interface RefOption<T> {
   get(): T
   set?(x: T): void
 }
-class RefImpl<T> implements Ref<T> {
+export class RefImpl<T> implements Ref<T> {
   readonly [_refBrand]!: true
   public value!: T
   constructor({ get, set }: RefOption<T>) {
diff --git a/test/v3/reactivity/readonly.spec.ts b/test/v3/reactivity/readonly.spec.ts
index 55131305..5272f480 100644
--- a/test/v3/reactivity/readonly.spec.ts
+++ b/test/v3/reactivity/readonly.spec.ts
@@ -1,5 +1,12 @@
 import { mockWarn } from '../../helpers/mockWarn'
-import { shallowReadonly, isReactive, ref, reactive } from '../../../src'
+import {
+  shallowReadonly,
+  isReactive,
+  ref,
+  reactive,
+  watch,
+  nextTick,
+} from '../../../src'
 
 const Vue = require('vue/dist/vue.common.js')
 
@@ -391,7 +398,7 @@ describe('reactivity/readonly', () => {
             countReadonly.number++
             // @ts-expect-error
             countRefReadonly.value++
-          }, 2000)
+          }, 1000)
           return {
             count,
             countRef,
@@ -401,5 +408,61 @@ describe('reactivity/readonly', () => {
 
       expect(vm.$el.textContent).toBe(`{\n  "number": 0\n} 0`)
     })
+
+    // #712
+    test('watch should work for ref with shallowReadonly', async () => {
+      const cb = jest.fn()
+      const vm = new Vue({
+        template: '<div>{{ countRef }}</div>',
+        setup() {
+          const countRef = ref(0)
+          const countRefReadonly = shallowReadonly(countRef)
+          watch(countRefReadonly, cb, { deep: true })
+          return {
+            countRef,
+            countRefReadonly,
+          }
+        },
+      }).$mount()
+
+      vm.countRef++
+      await nextTick()
+      expect(cb).toHaveBeenCalled()
+
+      vm.countRefReadonly++
+      await nextTick()
+      expect(
+        `Set operation on key "value" failed: target is readonly.`
+      ).toHaveBeenWarned()
+      expect(vm.$el.textContent).toBe(`1`)
+    })
+
+    // #712
+    test('watch should work for reactive with shallowReadonly', async () => {
+      const cb = jest.fn()
+      const vm = new Vue({
+        template: '<div>{{ count.number }}</div>',
+        setup() {
+          const count = reactive({ number: 0 })
+          const countReadonly = shallowReadonly(count)
+          watch(countReadonly, cb, { deep: true })
+          return {
+            count,
+            countReadonly,
+          }
+        },
+      }).$mount()
+
+      vm.count.number++
+      await nextTick()
+      expect(cb).toHaveBeenCalled()
+
+      vm.countReadonly.number++
+      await nextTick()
+      expect(
+        `Set operation on key "number" failed: target is readonly.`
+      ).toHaveBeenWarned()
+      expect(vm.$el.textContent).toBe(`1`)
+    })
   })
 })