A dreadful mistake from Adam Bogdan, who was replacing the injured Simon Mignolet in Liverpool's goal, allowed Nathan Ake to score a simple opener.
Ighalo, who now has 12 Premier League goals this season, netted shortly after with a neat finish before sealing the victory with a header five minutes from time to pile on the misery for the visitors, who never looked like launching a comeback.
The convincing win puts in-form Watford within one point of Tottenham in fourth place, while Liverpool remain ninth and have now won only three of nine league games since Jurgen Klopp took charge after a poor performance.
Liverpool made four alterations to their team as Bogdan, Roberto Firmino, Lucas Leiva and Mamadou Sakho came in for injured trio Dejan Lovren, Mignolet and James Milner, while Christian Benteke dropped to the bench.

