Today, the Internet of Things has evolved due to an advanced connectivity of physical objects. Furthermore, Cloud Computing gains more and more interest for the provisioning of services. In this paper, we want to further improve the integration of these two areas by providing a cloud-based situation recognition service – SitRS. This service can be used to integrate real world objects – the things – into the internet by deriving their situational state based on sensors. This enables context-aware applications to detect events in a smart environment. SitRS is a basic service enabling a generic and easy implementation of Smart* applications such as SmartFactorys, SmartCities, SmartHomes. This paper introduces an approach containing a method and a system architecture for the realization of such a service. The core steps of the method are: (i) registration of the sensors, (ii) modeling of the situation, and (iii) execution of the situation recognition. Furthermore, a prototypical implementation of SitRS is presented and evaluated via runtime measurements.