Former Wigan Athletic and Manchester United star confirmed as Championship's newest boss
The 34-year-old was placed in charge on an interim basis when Valerien Ismael was sacked in early March.
Cleverley has subsequently overseen seven Championship matches, in which the Hornets have registered one win, one loss and five draws.
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Hide AdThe team had lost six out of eight league games before Ismael was axed. They currently lie 15th in the table with two fixtures remaining, against Sunderland at home on Saturday and then Middlesbrough away to conclude their season.
Former Manchester United midfielder Cleverley, who was on loan at Watford from the Red Devils in 2009-10, returned to the Vicarage Road outfit from Everton in 2017 and remained part of the squad up to last summer when he retired from playing due to injury.
He subsequently made his first move into coaching with Watford's academy before taking on the interim head coach role last month.
The club's statement on Wednesday added that "a full first-team staffing structure for the 2024-25 season will be confirmed soon".
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Hide AdCleverley made 25 appearances for Latics, scoring four goals, during a season-long loan spell from United in 2010-11, playing a key role in helping Roberto Martinez’s men retain their Premier League status.
Indeed, his third and fourth goals came in the second half of the campaign in crucial 2-1 victories over Wolves and Birmingham City respectively – the two sides who finished immediately below Latics in the final standings.
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