EXHIBIT 5.1
                                                                    -----------

                   OPINION OF TESTA, HURWITZ & THIBEAULT, LLP


                                                                 March 14, 2002


Datawatch Corporation
175 Cabot Street
Suite 503
Lowell, MA 01854

      Re:    Registration Statement on Form S-8 Relating to the 1996 Stock Plan,
             as amended, of Datawatch Corporation (referred to as the "Plan")
             ----------------------------------------------------------------

Dear Sir or Madam:

           Reference is made to the above-captioned Registration Statement on
Form S-8 (the "Registration Statement") filed by Datawatch Corporation (the
"Company") on the date hereof with the Securities and Exchange Commission under
the Securities Act of 1933, as amended, relating to an aggregate of an
additional 127,733 shares of Common Stock, par value $.01 per share, of the
Company issuable pursuant to the Plan (the "Shares").

           We are counsel to the Company and are familiar with the proceedings
of its stockholders and Board of Directors. We have examined original or
certified copies of the Company's Restated Certificate of Incorporation, as
amended, the Company's by-laws, as amended, the corporate records of the Company
to the date hereof, and such other certificates, documents, records and
materials as we have deemed necessary in connection with this opinion letter.

           Based upon and subject to the foregoing, we are of the opinion that
the Shares to be issued under options issued or proposed to be issued by the
Company pursuant to the Plan will be, upon receipt of the consideration provided
for in the Plan, validly issued, fully paid and nonassessable after issuance of
such Shares in accordance with the terms of the Plan.

           We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement.

                                           Very truly yours,

                                           /s/ Testa, Hurwitz & Thibeault, LLP

                                           TESTA, HURWITZ & THIBEAULT, LLP