Fletcher will join the Hornets as a free agent on July 1 when his contract with Middlesbrough, where he spent four seasons after moving from West Ham expires.
The 25-year-old scored three goals in an injury-hit campaign last season. The length of his deal at Vicarage Road has not been disclosed.
Goalkeeper Rob Elliot has signed a two-year contract with the club after initially joining on a short-term deal in January to provide cover for Daniel Bachmann and Ben Foster.
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