A garment and system includes a monitoring fabric comprising a first plurality of reflective yarns knitted or woven with a second plurality of stretchable yarns. The fabric exhibits both a light transmission property and a light reflection property. The amount of light transmitted through the fabric relative to the amount of light reflected by the fabric changes when the fabric stretches in response to motion, such as the motion induced by physiological activity (e.g., heart rate). The system includes at least one source of radiation having wavelength(s) in the range of 400 to 2200 nanometers and at least one detector responsive to such incident radiation. The source and detector are associated with the fabric such that the reception of incident radiation by the detector is directly affected by a change in the amount of light transmitted through the fabric relative to the amount of light reflected by the fabric when the fabric stretches. A signal processor converts a signal from the detector into a signal representative of at least one predetermined physiological parameter of a wearer of the garment.