The Hornets led 3-0 after 68 minutes after Deulofeu's solo strike and curling efforts from Jose Holebas and Domingos Quina.
But the Bluebirds were grateful for goalkeeper Neil Etheridge's display and refused to submit, scoring two goals in three minutes to set up a nervous finale.
Junior Hoilett struck from 25 yards after 80 minutes and Bobby Reid scrambled in a second soon afterwards, but Watford held on to win. Cardiff now have one point from their last 10 Premier League away games.
Deulofeu came in for Isaac Success as the sole change from the starting line-up in last Monday's clash at Everton, when the Toffees stole a last-gasp draw to extend the Hornets' winless run.
The former Barcelona and Everton forward wore leggings and gloves and seemed to revel in the atrocious conditions.
He cut inside from the left to curl a shot just wide beyond the far post after six minutes.
His second goal of the season came 10 minutes later, when he bamboozled Bruno Ecuele Manga and Sean Morrison before sliding the ball into the bottom corner.
Cardiff had half chances to respond. Harry Arter surged into the right channel and his cross was just out of Josh Murphy's reach.
Callum Paterson headed wide soon afterwards, after Morrison flicked on Aron Gunnarsson's long throw.
And a Hoilett cross was just too high for Paterson, with Ben Foster scrambling to clear after Kiko Femenia almost directed the ball into his own goal.
Deulofeu's movement and creativity were troubling the Bluebirds.
He threaded a pass across the area, beyond a host of bodies, to Roberto Pereyra, who shot weakly and Etheridge saved.
Pereyra made Etheridge work harder to save his 25-yard free-kick in first-half stoppage time.
Murphy was replaced at half-time by Nathaniel Mendez-Laing, but it was Watford who began on the attack, with Etheridge denying Pereyra from the left side of the area once more.
Soon the Cardiff goalkeeper was beaten, with Deulofeu again influential. He checked and teed-up Holebas, who curled into the top corner from the edge of the box.
It was the Greece left-back's third goal of the season – a best after more than three seasons at Vicarage Road – and Watford have never lost when he has scored.
Home supporters sensed a first win since October's back-to-back successes against Wolves and Huddersfield.
And they were right to feel confident as Abdoulaye Doucoure found Quina on the edge of the area and the 19-year-old finished beautifully for his first Premier League goal.
Cardiff had chances of their own, when Victor Camarasa shot wide and Hoilett headed over.
Deulofeu exchanged passes with substitute Success and sent a shot fizzing across goal before Cardiff had a goal back when Hoilett curled in from 25 yards.
The visitors' second followed almost immediately. Ben Foster saved from Sol Bamba, but Watford failed to clear and Reid prodded the ball in.
Doucoure came close to restoring a more comfortable advantage for the hosts, only to be denied by Etheridge.
Tom Cleverley made his first appearance since January in a cameo which included crucial attacking and defensive contributions as Watford held on.