-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 GO9zoDwnyhH9x68WvN2PlWhjNpKl2P3Xfx/KU9Py1xUlz2eLTroYx3/Rb8XryDmE
 WDLLoZ3dnktBsWUj1tf5JA==

<SEC-DOCUMENT>0001072613-10-000381.txt : 20100323
<SEC-HEADER>0001072613-10-000381.hdr.sgml : 20100323
<ACCEPTANCE-DATETIME>20100323182105
ACCESSION NUMBER:		0001072613-10-000381
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20100319
FILED AS OF DATE:		20100323
DATE AS OF CHANGE:		20100323

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			KELLY THOMAS H
		CENTRAL INDEX KEY:			0001023208

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-19960
		FILM NUMBER:		10700177

	MAIL ADDRESS:	
		STREET 1:		SCHERING PLOUGH CORP
		STREET 2:		ONE GIRALDA FARMS
		CITY:			MADISON
		STATE:			NJ
		ZIP:			07940-1000

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
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>kelly4-031910_16767ex.xml
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0303</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2010-03-19</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

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

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001023208</rptOwnerCik>
            <rptOwnerName>KELLY THOMAS H</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>Common Stock</value>
            </securityTitle>
            <transactionDate>
                <value>2010-03-19</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>10000</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                    <footnoteId id="F1"/>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <footnotes>
        <footnote id="F1">The securities awarded on 3/19/2010 are in the form of restricted stock units (RSUs) issued pursuant to the Datawatch 2006
 Equity Compensation and Incentive Plan. 833 RSUs will vest on 3/19/2011 and an additional 833 RSUs will vest at 3/19/2012,
 with the final 834 RSUs vesting on 3/19/2013. 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/ Thomas H. Kelly</signatureName>
        <signatureDate>2010-03-23</signatureDate>
    </ownerSignature>
</ownershipDocument>
</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----