The present teaching relates to system, method, medium for in-situ perception in an autonomous driving vehicle. A plurality of types of sensor data acquired continuously by a plurality of types of sensors deployed on the vehicle are first received, where the plurality of types of sensor data provide information about surrounding of the vehicle. Based on at least one model, one or more items are tracked from a first of the plurality of types of sensor data acquired by one or more of a first type of the plurality of types of sensors, wherein the one or more items appear in the surrounding of the vehicle. At least some of the one or more items are then automatically labeled on-the-fly via either cross modality validation or cross temporal validation of the one or more items and are used to locally adapt, on-the-fly, the at least one model in the vehicle.