The Hornets were punished over the behaviour of their players during the 1-1 draw at Ipswich on December 21, when the award of a penalty sparked heated protests.
Giuseppe Sannino's first game in charge of the Hornets looked to be heading for a dull, goalless draw until referee Graham Scott pointed to the spot after Frank Nouble's cross appeared to strike Gabriele Angella on the arm.
Scott was surrounded by furious Watford players, and their protests took several minutes to abate before David McGoldrick fired Ipswich ahead with 19 minutes remaining.
Joel Ekstrand was the only player booked for his excessive behaviour, but Sannino's side were reported to the FA after being accused of taking their protests too far.
The Hornets were charged with failing to ensure their players conducted themselves in an orderly fashion and/or refrained from provocative behaviour.
Watford did not contest the charge, and the FA have confirmed they have issued the "standard penalty" of a £5,000 fine.