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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
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 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 F/1ojk+0+GQY1MqiGNBtzhpHf8pmilkq5oY7se2CkLl3qUh9M/q+oj7v9tSZ3Fq1
 ZQ5Qd5ukcCj363Kvlfen0g==

<SEC-DOCUMENT>0001072613-07-000666.txt : 20070313
<SEC-HEADER>0001072613-07-000666.hdr.sgml : 20070313
<ACCEPTANCE-DATETIME>20070313170112
ACCESSION NUMBER:		0001072613-07-000666
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20070309
FILED AS OF DATE:		20070313
DATE AS OF CHANGE:		20070313

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			DATAWATCH CORP
		CENTRAL INDEX KEY:			0000792130
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-PREPACKAGED SOFTWARE [7372]
		IRS NUMBER:				020405716
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0930

	BUSINESS ADDRESS:	
		STREET 1:		271 MILL ROAD
		STREET 2:		QUORUM OFFICE PARK
		CITY:			CHELMSFORD
		STATE:			MA
		ZIP:			01824
		BUSINESS PHONE:		978-441-2200

	MAIL ADDRESS:	
		STREET 1:		271 MILL ROAD
		STREET 2:		QUORUM OFFICE PARK
		CITY:			CHELMSFORD
		STATE:			MA
		ZIP:			01824

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			POTTER TERRY W
		CENTRAL INDEX KEY:			0001226521

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-19960
		FILM NUMBER:		07691227

	MAIL ADDRESS:	
		STREET 1:		C/O DATAWATCH CORP
		STREET 2:		175 CABOT STREET STE 503
		CITY:			LOWELL
		STATE:			MA
		ZIP:			01854
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>pro-potter_14884ex.xml
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2007-03-09</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000792130</issuerCik>
        <issuerName>DATAWATCH CORP</issuerName>
        <issuerTradingSymbol>DWCH</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001226521</rptOwnerCik>
            <rptOwnerName>POTTER TERRY W</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>C/O DATAWATCH CORPORATION</rptOwnerStreet1>
            <rptOwnerStreet2>271 MILL ROAD, QUORUM OFFICE PARK</rptOwnerStreet2>
            <rptOwnerCity>CHELMSFORD</rptOwnerCity>
            <rptOwnerState>MA</rptOwnerState>
            <rptOwnerZipCode>01824</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>1</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>CommonStock</value>
            </securityTitle>
            <transactionDate>
                <value>2007-03-09</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>2500</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0</value>
                    <footnoteId id="F1"/>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>2500</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                    <footnoteId id="F1"/>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <footnotes>
        <footnote id="F1">The securities awarded on March 9, 2007 are in the form of restricted stock units (RSUs) issued pursuant to the Datawatch
 2006 Equity Compensation and Incentive Plan.  833 RSU's will vest on 3/9/08 and an additional 833 RSU's will vest at 3/9/09,
 with the final 834 RSUs vesting on 3/9/10. This vesting schedule is subject to acceleration in certain instances in
 connection with an acquisition or other change of control event.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>By: /s/ Terry W. Potter</signatureName>
        <signatureDate>2007-03-13</signatureDate>
    </ownerSignature>
</ownershipDocument>
</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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