Interference from collocated networks operating over the same frequency range becomes an increasingly severe problem as the number of networks overlapping geographically increases within commercial and residential buildings. This paper aims to highlight the issues affecting co-existence of IEEE 802.15.4 (ZigBee) systems in the presence of interference. ZigBee uses the IEEE 802.15.4 PHY and MAC layer standards to handle devices. The practical performance of ZigBee systems are established with reference to supporting empirical and simulated data. Our experiments show that, among different interferers, interference from microwave ovens is indeed a major problem. Guidelines are provided for installing sensors inside buildings.