The 31-year-old, missing from the squad since December 23 for personal reasons, on Tuesday assisted on the first two goals as City bounced back after being held 0-0 by Crystal Palace on Sunday, reports Efe.
The hosts jumped out to a 1-0 lead in the first minute on a play that began with Silva's ball to Leroy Sane and ended with Raheem Sterling's 18th goal of the campaign.
Silva delivered a cross to Kevin de Bruyne just before the 15-minute mark and the Belgian international's shot deflected off Watford's Christian Kabasele into the net.
Sergio Aguero made it 3-0 for City in the second half before Andre Gray pulled one back for visiting Watford, who suffered their seventh loss in nine matches and occupy the 10th spot in the league table.
City are now 15 points ahead of second-placed Manchester United.
Reacting to Silva's return, coach Pep Guardiola told the club's website: "We are very happy David Silva is back with us. We don't know how long he will be with us but you saw again today he essential player for us.
"David is free to stay or to leave whenever he needs to. It depends," he added.
"He wants to stay and help us and because he loves to play for City, but family is the most important thing in life. I would never push him. If we drop points because he is not with us, so be it - family is everything and must come first."
Defending champions Chelsea are in third, just a point ahead of Liverpool, though the Blues have a game in hand. Fifth place belongs to Tottenham Hotspur, who beat Swansea 2-0 Tuesday on a rain-soaked pitch in South Wales.
Fernando Llorente, a former Swansea striker making his first EPL start for Tottenham, put the visitors up 1-0 with a goal in the 12th minute, but the outcome remained in doubt until Dele Alli got a second for Tottenham in the 89th.
I'm very happy to score my first goal in the Premier League for Tottenham and help the team. It was a difficult game in difficult conditions but the important thing was we were focused and aggressive. We wanted to play and move the ball quickly. We controlled the game and played really well, especially in the first half," Spaniard Llorente said.
"There was no pressure on me (coming in for Harry Kane) - for me, it was an amazing opportunity."
Crystal Palace climbed out of the drop zone with a 2-1 away victory over Southampton, whose winless streak stretched to nine matches.
Shane Long ended a long scoring drought to put the Saints ahead 1-0 in the 17th minute, but James McArthur and Luka Milivojevic scored for the London club in the second half.
Another struggling capital side, West Ham United, also came from behind in a 2-1 win against West Bromwich Albion.
Andy Carroll had both goals -- including the winner in stoppage time -- to lead the Hammers out of the relegation zone.
(This story has not been edited by Social News XYZ staff and is auto-generated from a syndicated feed.)
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