Although river water quality monitoring (WQM) networks play an important role in water management, their effectiveness is rarely evaluated. This study aims to evaluate and optimize water quality variables and monitoring sites to explain the spatial and temporal variation of water quality in rivers, using principal component analysis (PCA). A complex water quality dataset from the Freiberger Mulde (FM) river basin in Saxony, Germany was analyzed that included 23 water quality (WQ) parameters monitored at 151 monitoring sites from 2006 to 2016. The subsequent results showed that the water quality of the FM river basin is mainly impacted by weathering processes, historical mining and industrial activities, agriculture, and municipal discharges. The monitoring of 14 critical parameters including boron, calcium, chloride, potassium, sulphate, total inorganic carbon, fluoride, arsenic, zinc, nickel, temperature, oxygen, total organic carbon, and manganese could explain 75.1% of water quality variability. Both sampling locations and time periods were observed, with the resulting mineral contents varying between locations and the organic and oxygen content differing depending on the time period that was monitored. The monitoring sites that were deemed particularly critical were located in the vicinity of the city of Freiberg; the results for the individual months of July and September were determined to be the most significant. In terms of cost-effectiveness, monitoring more parameters at fewer sites would be a more economical approach than the opposite practice. This study illustrates a simple yet reliable approach to support water managers in identifying the optimum monitoring strategies based on the existing monitoring data, when there is a need to reduce the monitoring costs.