Watson snapped a five-way tie for the lead with the birdie that gave him a two-under-par 68 at Plainfield Country Club for a seven-under 133 total.
Missing the cut and relinquishing his world number one ranking was Masters and U.S. Open champion Jordan Spieth, who posted a three-over 73 for seven-over 147, five shots from the cut which was set at two over par.
Northern Ireland's Rory McIlroy will regain the top spot in the new rankings from Spieth, who claimed the number one berth after finishing runner-up at the PGA Championship two weeks ago.
“It is what it is,” said Spieth, whose disappointing round included a one-shot penalty at the 12th for stepping on his ball in a hazard.
Tied for second at The Barclays were British Open champion Zach Johnson (65), Sweden's Henrik Stenson (66) and Americans Jason Dufner (68) and rookie Tony Finau (69) on a warm, sunny day on the Donald Ross designed layout.
Watson, one of four players who shared the first-round lead, balanced a birdie with a bogey on the front nine but added a trio of birdies on the homeward side and bounced back from a bogey at the 17th with his birdie at 18 for the outright lead.
American Jason Bohn was a further shot back after firing a six-under-par 64 for five-under 135, a total shared with Camilo Villegas of Colombia (70). – Reuters
Original source: Watson leads at The Barclays