Energy remains a critical challenge for continuous sensing: with low-capacity batteries, wearable devices require frequent charging. In contrast, installing sensors in everyday ‘;smart objects’;, such as kitchen cabinets, household appliances and office equipment, supports ADL detection via indirect observations on human interaction with such objects, but cannot provide individual-specific insights in multi-tenanted environments. The embodiments herein provide a method and system for energy efficient activity recognition and behavior analysis. Architecture disclosed utilizes a hybrid mode of inexpensive, battery-free sensing of physical activities performed by a subject been monitored during his Activities for Daily Living (ADLs). The sensing combines object interaction sensing with person-specific wearable sensing to recognize individual activities in smart spaces. The method and system disclosed quantifies a probabilistic approach that uses longitudinal observations of user-item interactions, over each individual episode, to compute the anomalous behavior of the subject.