Watchitt is known for saying "WATCH IT!", making fun of his name. In Yold Town, there is a gap in the town which blocks Mario to venture onwards in his adventure. This gap can be crossed by a bridge let down by Green. Green only activates the bridge if Watchitt gives him permission though. Mario must talk to Watchitt and ask if he can activate the bridge, but he cannot call Green until he receives a hand-shaped pixl also found in Yold Town. After the bridge is activated, Watchitt no longer plays a role in the story.
Old Man Watchitt does play an optional role in the story. In the series of events that ends with Mario receiving a Piccolo, Watchitt is the second-to-last character Mario needs to talk to before he goes back to the other characters he has talked to on this errand. Bestovius gives Mario a Training Machine required in this quest if he receives the You-Know-What from Watchitt, which he can get by having received an autograph from Merlumina.
Merlumina has been haunting Watchitt's dreams throughout the story. This makes Watchitt receive little sleep (followed by the possible explanation on why he is always so angry). This only stops when Mario receives Merlumina's autograph in the errand. Watchitt is apparently related to Merlumina, as Merlumina could only haunt the dreams of a relative. This proves that Watchitt is also descended from the Tribe of Ancients.