Ten-man Watford thought they had snatched their first away win in ten games when Danny Graham headed them 2-1in front in the 90th minute with his second goal of the game.
But five minutes into stoppage time, Hooper struck with his second of the game from the spot after centre-back Jay DeMerit had handled an effort from home skipper Cliff Byrne.
Back in action for the first time in 11 days, Watford were full of running in the early stages against a tired-looking home side. The Hornets monopolised the early chances but could not find their finishing touch in front of goal.
Don Cowie squandered a good chance when he lifted his shot over from 12 yards and then full-back Marcus Williams came to Scunthorpe's rescue when he scrambled the ball off the line from a corner.
When Watford sliced open the home defence again, a flicked header from Heidar Helguson found his strike partner Graham racing into the box, but his shot was blocked by the legs of goalkeeper Joe Murphy.
But against the run of play, it was Scunthorpe who snatched a 42nd-minute lead when a pass from Paul Hayes split the Watford defence and leading marksman Hooper raced in to notch his 12th goal of the season.
As Scunthorpe then perked up in the second half, Scott Loach had to rescue the visitors from going 2-0 down with a brilliant fingertip save, turning a fierce shot from Martyn Woolford against the bar.
Watford took advantage of that reprieve with an equaliser after 64 minutes when Graham netted from close range after the home defence had failed to clear a corner.
As both teams chased a winner, it was Scunthorpe who went close through Hooper who broke free into the box but saw his angled drive turned away by Loach.
The visitors were reduced to ten men in the 82nd minute when teenage midfield man Tom Cleverley was red carded for a challenge on Michael O'Connor.
Then, in an explosive finish, Graham headed the visitors in front from a 90th-minute corner, only for Hooper to save Scunthorpe a point with what proved to be the last kick of the game.