Watford manager Marco Silva was quick to defend his player, however.
After Etienne Capoue hit the post, the game appeared set to finish all-square until Tom Cleverley popped up with an injury-time victor to complete the recovery mission and send Watford above Arsenal and up to fourth.
The Hornets suffered a heavy 6-0 defeat at the hands of Manchester City in their last Premier League clash before the worldwide break.
Deeney's impact off the bench made a real difference to the game, with Watford switching from three at the back to a 4-4-2 system following the introduction of their club captain.
Per Mertesacker headed Arsenal ahead in the 39th minute with his first league goal in 1400 days.
Hector Bellerin sent a left-footed effort wide moments later from a decent position, and substitute Mesut Ozil was an even bigger culprit in the second 45 minutes as his one-on-one chance saw his casual finish easily saved by Heurelho Gomes.
Moments later came the penalty drama, and then in injury time when Andre Carrillo's shot was blocked Cleverley lashed in a dramatic victor. "I believe that on the second goal we can only look at ourselves".
Nevertheless, Silva said: "I don't change what I said at the start of the season".