Reading slipped to a fourth straight defeat as Watford picked up their first Championship win of the season.
Winger Mark Yeates opened the scoring in the 12th minute when he curled a 25-yard set piece over the wall and into the bottom corner.
Mathieu Manset came close to an equaliser for the home side but headed over the top.
And Hornets captain John Eustace sealed the points with a simple six-yard tap-in after 51 minutes.
Reading defender Alex Pearce was caught in possession and when the ball was squared across the box, Eustace was free to score from close range - the midfielder's first goal since April.
Reading rallied in the closing stages but failed to find the target, with midfielder Mikele Leigertwood shooting wide and Wales international Hal Robson-Kanu missing the target when well placed.
The Royals have now collected just three points since selling striker Shane Long to West Brom at the start of August and have slipped into the bottom three.
Reading 01 Federici 02 Griffin (Robson-Kanu - 58' ) 05 Pearce Booked 16 Mills 17 Gorkss 04 Karacan (Cummings - 80' ) 08 Leigertwood 11 McAnuff 14 Kebe 09 Le Fondre 22 Manset Booked (Church - 75' ) Substitutes 12 McCarthy 24 Cummings 06 Gunnarsson 19 Robson-Kanu 18 Church Watford 01 Loach 03 Dickinson 05 Taylor 06 Mariappa 12 Doyley 04 Eustace 07 Yeates (Deeney - 80' ) 11 Forsyth Booked 32 Hogg 18 Weimann (Iwelumo - 89' ) 20 Sordell Booked (Garner - 75' ) Substitutes 13 Gilmartin 21 Mirfin 09 Deeney 10 Iwelumo 25 Garner