Watson, 38, will depart Trinity Mirror in September to return to his home in Scotland. He is to become the managing director of Menzies Distribution, part of John Menzies.
During a two-year stint at Trinity Mirror, after being appointed general manager of Mirror Group Newspapers in 2003 and promoted a year ago, Watson has had difficulty in juggling his working life in London and family life in Scotland.
He commented: "I have loved every thrilling moment in this wonderful business, working alongside many of the most talented people in newspapers.
"But I also love my family and wish to see them grow and develop, so I'm returning to my other passions in life and they are all in Scotland."
Sly Bailey, Trinity Mirror's chief executive, will lead the process of replacing Watson.
Last week, Trinity Mirror unveiled sales figures for the first four months of the year that showed revenues in the nationals division down by 2.4 per cent.