Sensational Watford scored four times in the final 12 minutes to record a first-ever win at Goodison Park as Claudio Ranieri celebrated a hat-trick from his former Everton forward Josh King.
Everton twice led through Tom Davies and the returning Richarlison but Watford showed tremendous spirit to level in the first half through King and then turn the game on its head in an amazing finale.
Once Juraj Kucka had headed Watford level, Everton collapsed with King adding two more before substitute Emmanuel Dennis completed the scoring in injury-time.
To make King's treble all the more remarkable, he hadn't scored in his previous 30 league games and had also failed to net in 11 appearances during a spell for Everton in the second half of last season.