Britos joins on a three-year contract after making more than 100 appearances for the Italian club over four seasons, helping them finish runners-up in Serie A in 2013 and also winning the Coppa Italia twice and the Super Cup once.
The 30-year-old was sent off in his final appearance for the club after head-butting Alvaro Morata during the closing minutes of a 3-1 defeat at Juventus in May.
He told Watford’s club website: “I always loved watching the Premier League so as soon as the opportunity to join Watford came up I didn’t need to think twice about it, I wanted to come straight away.
“My ambition is to help Watford to stay in the Premier League, and it is now a matter of concentrating hard on winning every game.”
Jurado has also signed a three-year contract with the Hornets after they paid an undisclosed fee to Spartak and links up once again with new Watford head coach Quique Sanchez Flores, who he played under at Atletico Madrid.
A product of Real Madrid’s youth set-up, the 29-year-old attacking midfielder played 115 times for Atletico after joining them in 2006 and scored nine goals in 2009/10 as Sanchez Flores led the team to Europa League glory and a runners-up spot in the Copa del Rey.
The playmaker signed for Bundesliga side Schalke 04 in 2010 and went on to appear in the Champions League and the Europa League.
After 72 games and nine goals for Schalke, Jurado was loaned to Spartak in September 2012, a move which was later made permanent. He played 77 times for the Russian side, scoring 14 goals.