Watson was one of thirty-four players suspended as part of the Essendon Football Club supplements saga for using the banned performance-enhancing substance Thymosin beta-4 during the 2012 AFL season.

[6] By the end of the 2009 season, Watson had gathered a reputation as Essendon's most important midfielder (coming first in the club's overall clearances) and improved his once-criticised kicking ability to above the standard of an AFL player.

Despite Essendon suffering a disappointing 2010 season, winning only seven games and finishing 14th on the AFL ladder, Watson enjoyed a successful first year as captain.

He was a consistent performer in an inconsistent season for the Bombers, polling 16 Brownlow votes from a total of 43 received by Essendon players,[7] including a three-vote game in his 100th AFL game, finishing equal-seventh in the 2010 Brownlow Medal count, and having the highest number of votes for a player from a team finishing outside the final eight.

Watson had a relatively good season in 2011 despite missing six weeks with a hamstring injury, earning 15 Brownlow votes and finishing runner-up in the Crichton Medal, losing out to up-and-coming third-year midfielder David Zaharakis.

Watson completed an outstanding 2012 season by winning the Brownlow Medal with 30 votes (though he was later ruled ineligible after being suspended during the Essendon Football Club supplements saga).

Watson missed three weeks with a broken collarbone in 2013, but had another consistent season, earning 17 Brownlow votes, finishing runner-up in the Crichton Medal to former St Kilda utility (and later successor as captain) Brendon Goddard, and being named on the interchange in the 2013 All-Australian team.

In Round 14, Watson played his 200th AFL game in what proved to be a torrid day for the Bombers, as they lost to St Kilda by 110 points.

Watson played his first competitive match in over eighteen months – and his first without being captain of the club since 2009 – when he and several of the other Essendon players who served bans in 2016 made their return to the field against Collingwood in the 2017 pre-season.

[16] As Watson had won the 2012 Brownlow Medal, during the season that the supplements program took place, the AFL Commission reviewed the award.

Watson was retrospectively ruled ineligible for the award by the Commission, and the medal then awarded to the next-highest vote-getters, Richmond's Trent Cotchin and then-Hawthorn player Sam Mitchell (who had just been traded to the West Coast Eagles at the time), under the normal rules regarding ineligible players in Brownlow Medal counts.

[23] In June 2019, Watson participated in the Big Freeze at the 'G alongside several former AFL footballers and Australian sportspeople to raise money for the Cure for MND Foundation.