Goncalves Jackson opened the scoring for Dallas in the 11th minute, but Dwayne De Rosario levelled on the stroke of half-time before Watson's decisive contribution.
The win allowed Dallas to increase their lead as Real Salt Lake lost 3-2 at the Montreal Impact.
Real twice led, thanks to Matteo Ferrari's seventh-minute own goal and Kyle Beckerman's 78th-minute effort, but twice Montreal levelled through Felipe Martins (39) and Marco Di Vaio (80).
Substitute Sanna Nyassi then grabbed the winner in the closing moments.
The New York Red Bulls were held to a 1-1 draw at the New England Revolution but it was enough to but them on top of the Eastern Conference.
Diego Fagundez put the Revolution ahead in the 54th minute, but the lead lasted just a minute before Lloyd Sam levelled.
Russel Teibert stepped off the bench to score his first two MLS goals in the Vancouver Whitecaps' 3-1 win over the Los Angeles Galaxy.
Teibert came on in the 14th minute when Daigo Kobayashi picked up an ankle injuy, and he netted in the 63rd and 76th minutes to put his side 2-0 up.
Another substitute, Gyasi Zardes, pulled one back in the 86th minute, but Darren Mattocks scored a third for Vancouver in the closing moments.
Lamar Neagle netted a double as the Seattle Sounders eased to a 4-0 victory over the San Jose Earthquakes.
Neagle opened the scoring in the 28th minute, before Mauro Rosales doubled the lead on the stroke of half-time.
Neagle grabbed his second nine minutes into the second period and substitute Obafemi Martins finished the scoring in stoppage time.
Goals from Edson Buddle (8) and Dillon Powers (70) gave the Colorado Rapids a 2-0 victory at the Columbus Crew, while Jack McInerney netted 15 minutes from time to give the Philadelphia a 1-0 win at the Chicago Fire.