The University of Glasgow conferred upon Watt the degree of LL.D., and in return he founded the James Watt prize in natural philosophy.

He was much affected by the death of his partner, the princely Boulton, in 1807, when he himself was seventy years of age. He took great interest in the monument and inscription elected to his honour. “I can with great sincerity say that he was a most affectionate and steady friend and patron, with whom, during a close connection of thirty-five years, I have never had any serious difference. As to his improvements and erections at Soho, his turning a barren heath into a delightful garden, and the population and riches he has introduced into the parish of Handsworth, I must leave such subjects to those whose pens are better adapted to the purpose, and whose ideas are less benumbed with age than mine now are.” He had the desire that the church within which his friend was buried should be improved. When the plans of the alterations were presented to him, he thought them paltry and unworthy. “Why,” said he, “if these plans be carried out, preaching at Handsworth will be like squirting the Word of God through a keyhole.” The result was that by his suggestions and his liberality it was greatly enlarged.

He outlived his partner for thirteen years-working in his garret, walking in his grounds, and occasionally making visits to Cheltenham, Glasgow, and other places. His eye was not dim, or his natural strength abated. He preserved the use of his faculties and the cunning of his hand to the last, and departed from life quietly and peaceably on the 19th August, 1819, in the eighty-third year of his age. The industries which he has created, and the commerce which he has advanced, the busy engines and flying wheels through the whole civilised world, are memorials of his life and power. The statue in George Square by Chantrey was erected in 1832. There is another, also by Chantrey, in Westminster Abbey. Lord Brougham stated that he was prouder of having penned the following inscription upon that statue than he was of any of his other works:—