On-loan signing Darren Huckerby paid immediate dividends for Forest manager Paul Hart as he scored a 53rd minute equaliser in an absorbing match at Vicarage Road.
The Manchester City striker was pencilled in for a substitution but as Hart admitted: "Despite not having played many games lately instead of getting tired, he seemed to go from strength to strength." Forest had to come from behind after Watford had dominated the first half.
Heidar Helguson headed home his 11th goal of the season in the 12th minute past Darren Ward after meeting Jamie Hand's chipped cross.
Watford continued to press forward and looked the better side with Gifton Noel-Williams leading the line well.
When Helguson chested down a cross he set up Stephen Glass but he blasted his effort over the bar.
The Icelandic international then went through but rolled his final shot beyond Ward and the far post.
Forest mustered just three goal attempts - their best being when Huckerby sent an overhead kick wide after he had gained a fortuitous bounce off Marcus Gayle.
Watford continued in the same vein in the second half but their manager Ray Lewington expected Forest to begin to affect play.
"They are the best footballing side in the First Division and they pull you about,†he said.
“They don't panic even when things aren’t going well. They just keep passing.†However, it was an error by full-back Paul Robinson which let in Marlon Harewood on the right.
His angled drive was blocked by Alec Chamberlain but Huckerby pounced to hammer the ball goalwards and it was deflected into the net off a defender.
Although Watford had a few chances to grab the winner Forest took control of the closing stages.
Harewood sent a soft header straight at the keeper and twice Gareth Williams fired tamely when well placed.
Forest's best chance fell to Michael Dawson but he headed against the bar.