The stand-in boss took the reins from Garry Hill who was relieved on his duties last month with the Fleet bottom of the National League.
A recent purple patch under Watson has seen the club lift themselves off the foot of the table and secure a place in the FA Cup first round.
Yesterday's draw with Chesterfield made it five unbeaten for Watson and the Fleet - and he is looking ahead.
“I am truly delighted," he told the club's website. "When I took over I only had improvement in the short-term in my sights and now I can look long-term.
"With a club like Ebbsfleet, you knew there was going to be a lot of applicants. I was aware there’s 30 or 40 people waiting for me to fail to take their chance so it does feel like a weight off in a way and there’s nobody over my shoulder.
"I’ve always backed myself and I will always back myself to get this club out of trouble," he added.
“I said I’ve done my apprenticeship and given the chance, I wanted to show what I could achieve and we’re starting to show that."
Watson's first game in permanent charge of the club will be next Saturday against Notts County in the FA Cup.