After a tough first-round victory over world number 69 Christina McHale, the 21-year-old again came through a tight match to defeat Czech Lucie Hradecka 6-1 4-6 6-4.
Watson has dropped down from the WTA Tour to the second-tier ITF circuit in a bid to end a very difficult year on a high.
When the Guernsey player made the last eight in Memphis in February, it took her to a career-high ranking of 39.
But soon after she was sidelined for two months by glandular fever and until arriving in Poitiers she had won just five matches since, with her ranking plummeting to 133.
In the last eight in France, Watson will meet either American third seed Alison Riske or Canada's Stephanie Dubois.
There was disappointment, though, for Johanna Konta, who has overtaken Watson as British number two but lost to Austria's Tamira Paszek on a deciding tie-break having won the second set 6-0.