A novel experimental method is proposed for observing plasma dynamics subjected to magnetic fields based on a newly developed cylindrical theta-pinch device. By measuring simultaneously the temporal profiles of multiple parameters including the drive current, luminosity, plasma density, and plasma temperature, it provides a basis for observing the plasma dynamics of the theta pinch, such as shock transport and magnetohydrodynamic instability. We show that the plasma evolution can be distinguished as three phases. First, in the radial implosion phase, the trajectories of the current sheath and shock wave are ascertained by combining experimental data with a snowplow model (Lee model) in a self-consistent way. Second, in the axial flow phase, we demonstrate that m = 0 (sausage) instability associated with the plasma axial flow suppresses the plasma end-loss. Third, in the newly observed anomalous heating phase, the lower-hybrid-drift instability may develop near the current sheath, which induces anomalous resistivity and enhanced plasma heating. The present experimental data and novel method offer better understanding of plasma dynamics in the presence of magnetic fields, thereby providing important support for relevant research in magneto-inertial fusion.