Announcing the deal on their website (www.watfordfc.com), the Hornets did not disclose terms for the 28-year-old Romanian international, although media reports have indicated he was available on a free transfer.
Pantilimon joined Sunderland in 2014, after three seasons at Manchester City, and made 49 appearances for the club.
He featured in 18 matches for the Black Cats this season but fell out of favour after a 3-1 defeat at Chelsea in December, with Jordan Pickford and Vito Mannone moving up the pecking order.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
The Romanian had not made the matchday squad for the last three games but at Watford, he will provide competition for first choice Heurelho Gomes.
Sunderland are 19th in the 20 team league, Watford in 12th position.
(Reporting by Alan Baldwin, editing by Pritha Sarkar)
