Will Buckley's first goal for the Hornets gave Malky Mackay's men a deserved lead at the break, but the home side improved in the second period and skipper Callum Davidson evened proceedings.
Crystal Palace's draw with Middlesbrough means Watford remain a point above the drop zone despite winning just once in their last 11 outings.
After a dour opening, the home side had their first chance in the 17th minute when Paul Coutts lifted a measured ball over the Watford defence to release overlapping full-back Billy Jones. His attempted cut-back was deflected onto the outside of the post by Jon Harley.
Waford failed to fully clear the resulting corner and when the ball returned to the area Jon Parkin volleyed narrowly wide.
It was from the aftermath of another set piece that Watford nearly opened the scoring.
Harley collected possession after a Tom Cleverley corner had been cleared, and his raking ball to the back post found Buckley whose nod back was headed over by Martin Taylor.
Watford were becoming calmer in possession as their dead ball work continued to cause Preston problems. A half-clearance was collected by Cleverley who fizzed the ball towards the far post where Harley stabbed goalwards and Andy Lonergan saved excellently.
Buckley had a penalty claim rejected and received a yellow card for simulation in the 30th minute after going down under St Ledger's challenge, but the impressive former Rochdale winger cut a happier figure five minutes later.
Adrian Mariappa's ball forward was nodded down by Heidar Helguson to Buckley who this time skipped past St Ledger before lashing across Lonergan into the top corner.
At half-time Preston replaced the disappointing Parkin with Neil Mellor, but it was on-loan Manchester United midfielder Matthew James who helped them establish the greater control of possession that led to a 53rd minute.
Keith Treacy, on for the injured Chris Sedgwick, found space on the right wing and crossed for Davidson to head home at the far post.
Watford responded to draw the save of the match from Lonergan in the 64th minute.
John Eustace's diving header from Henri Lansbury's arching cross appeared to have gone beyond the North End keeper, but he somehow scooped the ball to safety with his right glove before pouncing gratefully upon it.
The Hornets piled forward in search of a vital win, peppering the Preston penalty area, but James' searching cross field ball found Ross Wallace on the counter attack with 15 minutes remaining and the Scot squared to Mellor who fizzed a 20 yard effort narrowly over.
Lansbury departed after a crunching challenge from Treacy with five minutes remaining and from the resultant free-kick substitute Danny Graham bundled home Helguson's knock down, but the linesman's flag was raised.
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