First-half goals from Heidar Helguson and Martin Taylor, with his first for the club, mean the Hornets have now lost only one of their last eight games at Vicarage Road and taken 19 points from a possible 24 to keep their hopes of a strong finish to the season on track.
In contrast, City are heading in the opposite direction after just one win in nine in the league, having paid the price for a thoroughly abject display in the first half.
Watford were to dominate virtually the entire opening 45 minutes and, after Taylor had headed a corner wide, their early pressure was rewarded in the 14th minute when Adrian Mariappa sent over a fine cross from the right and Helguson pulled away from his man to score with a trademark header.
Boosted by the goal, the Hornets continued to push on and deservedly scored a second in the 34th minute.
After Alvaro Saborlo had been booked for a foul on Jay DeMerit, Henri Lansbury struck the resultant free-kick precisely to the back post where Taylor had stole in to guide home his first Hornets goal from a tight angle on the right side of the six-yard box.
It was no surprise that boss Gary Johnson made a double change at the interval, bringing on Marvin Elliott and Ivan Sproule for Saborlo and Jamie McAllister respectively.
And but for fine save from Scott Loach, the visitors would have reduced the deficit six minutes after the restart when Liam Fontaine was left totally unmarked to connect with Lee Johnson's free-kick from the right, but the England Under-21 keeper superbly tipped his header over.
The visitors continued to try and force their way back into the contest with Patrick Agyemang heading narrowly over.
But the Hornets' defending was largely calm and assured and they were able to see out the remainder of the game with few alarms.