In this paper, a novel solar water heating system (SWHS), capable of reducing the impact of solar radiation intensity fluctuations, has been fabricated by using phase change materials (PCM) for thermal energy storage and inserted oscillating heat pipe (OHP) for performance improvement. Different working modes can be selected according to the solar radiation intensity in different seasons and different climate conditions. A test rig has also been made for the performance measurement of the system. The full-year measurement in all kinds of environmental conditions has been carried out for a couple of consecutive years, in Nanjing city of China. The system performances, such as collecting efficiency (CE), average collecting efficiency (ACE), coefficient of performance (COP) and exit water temperature (EWT), have been measured and compared between the systems with and without PCM. Under similar operation conditions, the system with PCM is illustrated to have much better performances. In daytime, CE fluctuation with PCM is over 30% less than that without PCM. At summer night, EWT with PCM can keep over 50 degrees C, while EWT without PCM has an obvious decrease. At winter night, COP with PCM is over 3.0 that can make EWT reach to 50 degrees C in a much shorter time than that without PCM. The system presented is proved to be effective and useful in the application of solar energy.