The paper suggests a novel algorithm for mobile object tracking using wireless sensor networks (WSNs). The paper assumes a future model of WSNs, where a large number of low to medium range inexpensive and noisy sensors are distributed randomly over an area. The distributed algorithm is based on short range communication between neighboring sensors, and is designed to work with very basic low cost binary sensors, that can report only a sensing, not sensing value. Neighboring sensors that sense the object form a cloud around the object which is dynamically updated as the object moves. Our algorithm works well with false negative sensing and up to 10% false positive sensing.