In this paper a method to characterize the anisotropy of diffuse illumination incident on photovoltaic systems is presented. PV systems are designed based on standard conditions in which only consider direct and isotropic diffuse illumination. Anisotropic illumination can cause the PV system output to step outside of the design specifications. A baffled multi-detector sensor system is described having a discrete set of azimuthal and declination angle combinations in order to constantly sample the irradiance and the incidence angle of the diffuse illumination in all zenith directions. The sensor was deployed in the Tucson Electric Power Solar Test Yard alongside with commercially available PV systems that are independently monitored. Constant and transient sources of anisotropic diffuse illumination, such as surface reflection and cloud edge effects respectively, are measured and modeled with ray tracing software. Results of the method are described for characterizing diffuse illumination at the TEP Solar Test Yard. Understanding the anisotropic diffuse illumination can potentially allow to more accurately predict PV system or to optimize energy harvesting of systems with non-standard mounting conditions as well as building integrated photovoltaic applications.