'Unbeknownst to all of us, she was observing all the time, everyone and everything."

Philadelphia Councilwoman María Quiñones-Sánchez is talking about her step-niece, Quiara Alegría Hudes, a true daughter of West Philly who won the Pulitzer Prize for drama on Monday.

Hudes, 34, won for her play Water by the Spoonful, a tale of a soldier's return from war, life at a Philly sandwich shop, and the struggle with addiction. David Rooney of the Hollywood Reporter called the win "an upset that went against industry predictions." Hudes, contacted at Wesleyan University in Middletown, Conn., where she's teaching a playwriting course, says, "I'm so surprised. There were such great people in the category."

The other two finalists were Jon Robin Baitz for Other Desert Cities, about a well-to-do California couple whose daughter's book may rattle skeletons in the family closet, and Stephen Karam for Sons of the Prophet, focusing on the trials and triumphs of a Lebanese American family.

It's only the latest height for Hudes. She was a 2007 Pulitzer finalist for Elliot, A Soldier's Fugue, and she wrote the libretto for In the Heights, a smash musical that won four 2008 Tony Awards. Water is the second of a trilogy of plays that "are based on my family, on my relatives, on people I met and talked to all around me as I grew up. They're totally Philadelphia." Elliot, the first of the trilogy, played at the Walnut Street Theatre in 2010, her hometown debut. The final play, The Happiest Song Plays Last, is scheduled for a 2013 debut at the Goodman Theatre in Chicago.

Her stepfather, Sedo Sánchez of Philadelphia, says, "I told her she was going to win it someday. She came close the time before , and I told her, 'Next time, it's yours.' But I didn't think it was going to be so soon!"

Hudes, who now lives in Manhattan, says she heard the news "during our stretch-your-legs break" at Wesleyan.

"Philadelphia is the living, beating heart of my work," she says. She grew up in West Philly, "right by 49th and Baltimore." Her father is Jewish, her mother (Virginia Sánchez, an Overbrook resident) Puerto Rican. After a divorce, her mother remarried Sedo Sánchez, and Hudes moved to the rich, diverse neighborhood at 49th and Baltimore. "I felt there were incredible American stories in my family and in my community that deserved retelling," she says, "funny, painful, wonderful stories. My identity and sense of purpose does come from the diverse history and neighborhoods of Philly, and I've learned to travel among them all."

Quiñones-Sánchez credits the "strong women" in Hudes' life: "She had a wonderful, traditional matriarch as a grandmother, and her mother, Virginia, always taught her, on one hand, to know where she was from, and on the other, to realize that she had other worlds to conquer."

Precocious in both music and creative writing, Hudes attended Friends Select for a time and had her first success at Central High, where in 1993 her one-act play My Dreams About Girls was a winner at the Philadelphia Young Playwrights Festival and was eventually performed at Temple University. A bachelor's in music from Yale University followed (she composed two musicals there), as did a master's of fine arts in playwriting at Brown University.

Family members say that all along, Hudes was a girl with eyes wide open.

"She was always very observant," says her father, Henry Hudes of Phoenixville. "Very intelligent, very into everything that was around her. She wanted to know everything, always asking questions, right from the time when she was a little kid."

Asking questions, says Quiara Alegría Hudes, is central to her art. "For me, every conversation is an interview. I based Water by the Spoonful on just a lot of conversations, a lot of interviews. But then, that's how I've gotten through a lot of my life, is by talking to people and listening to what they say."

Water concerns Elliot (of Elliot, A Soldier's Fugue), an injured Iraq-war vet who comes home to Philadelphia. He has to face down the nightmares of his war experience, and his mother, Odessa Ortiz, who, under the Internet handle Haikumom, also runs recovertogether.com, an Internet chat room for those struggling with drug addiction. The challenges faced by mother and son thus connect with those of people all over world, and all over Philly.

Sedo Sánchez says watching the plays can be like a home movie. "Sure, I've seen myself up there, uncles, relatives, her mother, her aunt, the whole family." It's an especially exciting time, he says: His daughter Gabriela, Quiara's half-sister, just cofounded the multicultural nonprofit company Power Street Theater in Philadelphia.

"I still really love the place," the new Pulitzer winner says. "Philadelphia is where the American experiment started, and where, with all these diverse cultures coming together, the experiment is still going on. I think that's where I get much of my resources for my work."

Contact John Timpane at 215-854-4406 or jt@phillynews.com, or follow him on Twitter at @jtimpane.