Waugh, critical about his team's showing in the first Test which it won, said the players were not at their sharpest in the Tests and urged them to be more focused in the second, beginning on Saturday.
"As a captain you just know sometimes with the feeling out there whether everyone is switched on and alert.
"The crowds over here [the West Indies] can be distracting for players on the boundaries. Not in a bad way, they just like a chat."
"Our blokes are pretty friendly towards the spectators and on occasions we drifted off a bit there, so it's just something to watch. It's not a bad thing, we've just got to be aware of it," he said.
A house full is expected at Queen's Park Oval, the venue of the second Test, where captain and hometown hero Brian Lara will be spared the jeers which followed him in Georgetown.
However, the Aussie captain is not declaring a ban on talking with the crowd. "You've got to have time out and interract with the crowd if you want to.
"There's no rules and regulations placed on it. We've just got to be ready to move into a different position or just be switched on," he said.
Whether Australia batsman Damien Martyn's has any role to play in the team on the ongoing tour of the West Indies will be known next week when he faces a fitness test.
A broken finger ruled Martyn out of the Test series, but has was provisionally named in a 15-man squad for the seven one-day internationals which follow the Test series.
"We will keep close watch on his progress and make a decision on his availability for the series, based on the relevant medical advice, closer to the time of departure," said chief selector Trevor Hohns.
Martyn suffered the injury during the World Cup game against Kenya, but still played in the final against India, scoring an unbeaten 88 as Australia retained the title they won in 1999.
The selectors have kept faith with 14 of the 15 players involved in the latter stages of the tournament in South Africa.
The only change is fast bowler Jason Gillespie's inclusion in place of Nathan Bracken.
Gillespie was forced to fly home mid-way through the World Cup because of an Achilles tendon problem, but has recovered fully and is playing in the Test series.
"Winning a tournament as important as that is a fairly good indicator that at this point in time, we have the right player-mix at the one-day international level.
"The players we have selected all deserve their place in the squad," Hohns added.
Australia paceman Glenn McGrath will return to the West Indies on Monday in time for the third Test, after missing the
The Australian Cricket Board announced McGrath's itinerary, while naming the 15-man squad for the seven-match one-day series.
McGrath will travel with Queensland's Jimmy Maher, who will head to the West Indies well ahead of his one-day teammates to deputise as wicketkeeper in Australia's tour game next week against a University of the West Indies vice-chancellor's XI, giving Adam Gilchrist a well earned rest.
The one-day squad is virtually the same as the one that started the World Cup. Damien Martyn was selected, subject to him passing a test next week on the broken right index finger that has forced him out of the present Test series.