Danny Graham struck a late winner as Watford killed off a Leicester fightback to claim three vital npower Championship points with a 3-2 victory.
Jordon Mutch delivered a cross from the right and John Eustace got across the face of his marker to steer a crisp volley into the far corner.
Mutch and Leicester midfielder Andy King then traded long-range efforts which fizzed wide before Will Buckley doubled the home side's lead in comical fashion. In the 22nd minute Foxes keeper Chris Weale misjudged the flight of the ball to present Buckley with the simple opportunity of tapping into an open goal.
After the break, Darius Vassell ran into the area before playing in Kyle Naughton on the overlap. His cross struck Andrew Taylor and referee Kevin Wright had no hesitation in awarding a penalty. Gallagher took the kick and smashed it into the roof of the net.
Gallagher was fouled on the edge of the area by Lloyd Doyley after 69 minutes and made no mistake with the free-kick, curling a fine effort over the wall and past Scott Loach to find the bottom corner.
Mutch - whose set-piece delivery had been immaculate all afternoon - floated in another great cross and Graham flicked a header across Weale and into the far corner.