Jay Rodriguez earned himself a footnote in Burnley history but his 20th goal of the season was of little consolation on a day the Clarets' play-off prospects suffered possibly irreparable damage.
Rodriguez became the first Claret since Robbie Blake in 2003/04 to reach the landmark as he made it eight goals in the last ten games.
The Burnley-born striker gave his side a half-time lead and Nyron Nosworthy's own-goal five minutes into the second half appeared to have handed the visitors the points and a ninth away win of the season.
But a disastrous 20-minute spell then undid all the hard work as Nosworthy struck at the other end with the first of three quick-fire goals to sentence the shell-shocked Clarets to a fourth defeat in five games.
Burnley now sit out the round of mid-week matches and with the gap widening behind the top six, Eddie Howe's side faces a major task to keep their season alive over the closing 12 games of the campaign.
It was evident on a bumpy pitch at Vicarage Road that the Clarets were minded to play no-risk football and take no undue chances in their own half against a Watford side seeking to avoid a hat-trick of defeats.
Jay Rodriguez celebrates his 20th goal of the season
Ben Mee had perhaps forgotten the script when his weak headed back-pass allowed Troy Deeney in for an early chance which forced Lee Grant to make a vital block.
Mee later made amends with an excellent headed clearance under pressure from Prince Buaben at the back post and Grant superbly tipped over Buaben's deflected shot at full stretch eight minutes before the break.
But that apart, the Clarets dealt with Watford's limited threat comfortably enough and did most of the pressing in an opening half which was threatening to meander to a goalless conclusion until Rodriguez pounced.
On-loan Manchester United goalkeeper Tomasz Kuszczak grabbed an early David Edgar headed and was kept busy dealing with a number of crosses into his penalty area.
But none really found their intended target with the lively Ross Wallace the Clarets' most productive source, clipping one drive onto the roof of the net before Rodriguez took centre stage.
The Clarets celebrate going 2-0 up
Ironically Watford had just enjoyed their best spell of possession before a weak back header from Adrian Mariappa opened the door for the Clarets' top marksman.
And Rodriguez needed no second invitation to chest the ball forward into the penalty area before clinically drilling a low shot past Kuszczak to reach the magic milestone.
Knowing a clean sheet from then on in would get them the points, the Clarets were forced into what turned out to be a costly defensive change at the break with Brian Easton coming on for the injured tower of strength that is Michael Duff.
Easton went to left-back and Mee moved inside in the re-shuffle but almost immediately Burnley had the cushion of a second goal as Wallace's free-kick was headed into his own net by Nosworthy.
Howe's men couldn't have asked better but the two-goal advantage lasted only five minutes as Watford struck back to get themselves back into the hunt.
Nyron Nosworthy heads Burnley's second
A fine tip-over from Grant prevented an inswinging corner from finding the net but with Sean Murray then given the chance to deliver the ball from the other side, Nosworthy rose highest to make amends with a powerful header which bounced down and back up into the roof of the net.
With their tails up the Hornets then almost grabbed an equaliser as the busy Nosworthy came up for another set-piece and drilled in a low shot which Mee blocked in front of Grant.
It was backs-to-the-wall stuff for a spell but just when it looked as though they had weathered the storm and Wallace had gone inches away from curling in a free-kick at the other end, the Clarets conceded again.
Lloyd Doyley's throw-in was cleverly flicked on by Joe Garner and substitute Alex Kacaniklic showed great composure to fire a low shot past Grant and into the far corner of the net.
And if that was a body-blow to the Clarets what followed three minutes later was even more painful as Watford went 3-2 up.
Agony as the Hornets win it
Again Burnley were unable to deal with a corner and when the ball dropped in the six-yard box Deeney poked the ball home after Garner's initial effort had been blocked on the line.
With their top-six hopes fading further the Clarets needed a response and inevitably it was Rodriguez who almost provided it.
This time, though, Kuszczak was equal to a fierce drive which he turned round the post to dash the Clarets' hopes of pulling something from the wreckage.
Watford: Kuszczak, Hodson, Marriapa, Nosworthy, Doyley, Buaben (Kacaniklic ht), Eustace, Hogg, Murray (Bennett 90), Garner, Deeney. Subs: Iwelumo, Trotta, Loach.
Booked: Deeney 75
Burnley: Grant, Trippier, Duff (Easton ht), Edgar, Mee, McCann, Marney, Wallace, Rodriguez, Austin (Paterson 69), McQuoid (Ings 82). Subs: Bartley, Jensen.
Booked: Wallace 82
Referee: Michael Naylor
Attendance: 11,612 (Burnley 980)