Michael Chopra ended his long wait for a goal with a last-minute winner as Ipswich took the points from Gianfranco Zola's Watford.
Chopra had gone 12 games without a goal - a run stretching back to March - but was on the end of a flowing move.
In a scrappy first half Lee Martin went close for the visitors, before Jay Emmanuel-Thomas drove wide from a cleverly worked free-kick.
Chopra's long wait
Michael Chopra's last goal also came in a 1-0 win for Ipswich - against Burnley on 21 March
Chopra then missed from six yards out before finding the late winner.
Paul Jewell's Ipswich side had lost their last five matches against the Hornets and were without a victory over their Championship rivals in their previous 15 meetings.
But they started strongly and held the upper hand for long periods.
Former Arsenal midfielder Emmanuel-Thomas was a particular threat, testing his former Gunners team-mate Manuel Almunia on three occasions in the first half.
Watford improved with the introduction of Chris Iwelumo, and the big substitute immediately created an opening for Almen Abdi, who fired over the crossbar from 12 yards.
But a 0-0 draw still seemed likely until stoppage-time, when Carlos Edwards put a ball across the face of goal and Chopra slid in to steer in the winner.
Watford manager Gianfranco Zola told BBC Three Counties Radio:
"It was disappointing (to concede such a late goal) but, frankly, they played better than us and deserved to win.
"They kept the ball better than us and that was the difference.
"In the first half especially, in midfield we couldn't keep the ball as a unit - we were losing the ball when we were coming out (of defence) with it and they caught us out of position all the time.
"It was difficult for us to get the rhythm of our game until probably 20 minutes to go. When Chris (Iwelumo) came on, it caused some problems for them, but it wasn't enough."
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