webpack-dev-server does not watch for my file changes

When I change my files while webpack-dev-server is running, the bundle's files are not updated. Here are my webpack.config.js and package.json files, as you can see from my npm script, I've solved running webpack watch and webpack-dev-server in the same command (npm run watch & webpack-dev-server --content-base ./ --port 9966):

webpack.config.js:

'use strict';

var ReactStylePlugin = require('react-style-webpack-plugin');
var ExtractTextPlugin = require('extract-text-webpack-plugin');

var webpack = require('webpack');

module.exports = {
    devtool: 'sourcemap',
  entry: ['./js/main.js'],
  output: {
    filename: 'bundle.js',
    path: __dirname + '/assets',
    publicPath: __dirname + '/'
  },
  module: {
    loaders: [
      {
        test: /\.js$/,
        loaders: [
          ReactStylePlugin.loader(),
          'jsx-loader?harmony'
        ]
      },
      {
        test: /\.css$/,
        loader: ExtractTextPlugin.extract('css-loader')
      }
    ]
  },
  plugins: [
    new ReactStylePlugin('bundle.css'),
    new webpack.DefinePlugin({
      'process.env': {
        // To enable production mode:
        //NODE_ENV: JSON.stringify('production')
      }
    })
  ]
}

package.json:

{
  "name": "reactTest",
  "version": "1.0.0",
  "description": "",
  "main": "index.js",
  "scripts": {
    "test": "echo \"Error: no test specified\" && exit 1",
    "watch": "webpack --watch",
    "build": "webpack",
    "web": "npm run watch &  webpack-dev-server --content-base ./ --port 9966"
  },
  "author": "",
  "license": "ISC",
  "devDependencies": {
    "css-loader": "^0.10.1",
    "extract-text-webpack-plugin": "^0.3.8",
    "jsx-loader": "^0.13.1",
    "react-style-webpack-plugin": "^0.4.0",
    "style-loader": "^0.10.2",
    "url-loader": "^0.5.5",
    "webpack": "^1.8.5",
    "webpack-dev-server": "^1.8.0"
  },
  "dependencies": {
    "react": "^0.13.1",
    "react-style": "^0.5.3"
  }
}

my directory structure is:

assets  
  bundle.css
  bundle.css.map    
  bundle.js 
  bundle.js.map 
js
  AppActions.js
  Profile.css.js
  ProfileList.js
  main.js
  AppConstants.js
  AppStore.js       
  Profile.js
  ResultPage.js     
package.json
index.html
node_modules
webpack.config.js

every file inside assets directory is generated by webpack

In order to get webpack to watch my file changes (Ubuntu 14.04), I had to increase the number of watchers (I had increased the number before, but it was still too low):

echo fs.inotify.max_user_watches=524288 | sudo tee -a /etc/sysctl.conf && sudo sysctl -p

Source in the official docs: https://webpack.github.io/docs/troubleshooting.html#not-enough-watchers

I first suspected the cause to be fsevents which doesn't work on Ubuntu, but this apparently wasn't the case.

Furthermore, because now the watching and re-compiling worked, but the automatic browser refresh part didn't work, I added the --inline param to the answer of @deowk which enables the "inline mode": webpack-dev-server --content-base ./ --port 9966 --hot --inline

Quote from the official docs: "The easiest way to use Hot Module Replacement with the webpack-dev-server is to use the inline mode." Source: https://webpack.github.io/docs/webpack-dev-server.html#hot-module-replacement

you need to run webpack-dev-server with the --hot flag:

webpack-dev-server --content-base ./ --port 9966 --hot

Then you can access the hot-loading version localhost:9966/webpack-dev-server/

You don't need to run watch as well.

update:

This entry in your webpack config must change:

entry: ['./js/main.js'], --> entry: ['webpack/hot/dev-server' , './js/main.js']

Change your publicPath entry:

publicPath: '/assets/'

@funkybunky identified the right problem but (IMHO) fixed it the wrong way. At least in my case, webpack was trying to watch every file it used, including a deep chain of thousands of files of dependencies pulled from npm. I added this to my config, per the docs:

devServer: {
  watchOptions: {
    ignored: /node_modules/
  }
}

Of course you legitimately could have thousands of files that might need to be watched, in which case go ahead and raise the limit, but you're probably better off ignoring vendor libraries that aren't likely to change.

I'll put this here just in case it helps anyone. My problem was the same, but caused by inconsistent capitalization of directory names and webpack alias declaration.

I had a WebGL directory which i referenced in my aliases as webgl, and unfortunately this worked for the build, but didn't work for code watching.