The 24-year-old, who scored as Inverness beat Falkirk to lift the Scottish Cup last Saturday, was on Derek McInnes' summer shopping list as the Dons boss looks to strengthen his side.
But Englishman Watkins has decided upon a return down south after his Caley Thistle contract ended, and he's penned a two-year deal with Barnsley.
Get all the latest transfer news, rumours and gossip on our forum.