Sergeant Iain Duncan said the 52-year-old from Alloa was discovered within a wooded area of Sauchie at around 11.20am during a search.
Ms Watson had been reported missing since Friday.
Sergeant Duncan said: “I want to take this opportunity to extend my deepest condolences to Jacqueline’s family at this time. We will continue to provide them with all the relevant support and assistance they may require.
“I’d also like to thank members of the public who assisted with our appeal or came forward with information, which we progressed as part of our inquiries.”
Sergeant Duncan added that there are no suspicious circumstances surrounding Ms Watson’s death and a report will be submitted to the Procurator Fiscal.