In an existing substructural dynamic response reconstruction method (Li, J., and Law, S.S., 2011. “Substructural Response Reconstruction in Wavelet Domain,” ASME J. Appl. Mech., 78(4), p. 041010) developed by Law, two sets of sensors are needed for the reconstruction of dynamic responses at selected degrees-of-freedom. A method to find the optimal sensor placement is presented in this paper for the substructural response reconstruction. It is based on the effective independence method but in the time domain. Unlike previous methods on sensor placement, two sets of optimal sensor placement are needed with the first set for estimating the interface forces between substructures, and the second set for reconstructing the responses. Sensors that capture the most information of the interface forces will be selected into the first set, and the subsequently estimated interface forces are used to reconstruct the responses at the second set of selected degrees-of-freedom. The selection of the second set of sensors is based on the least measurement noise effect in the response reconstruction process. A box-section bridge deck is adopted in the simulation studies. Numerical simulations with the forward and backward sequential sensor placement methods show that the proposed method could give reasonable predictions with smaller error in the reconstructed responses, and sensor locations along the major directions of the interface forces should be selected into the first or the second set of sensor configuration.