Watford is a real town, just north-west of London, at the edge of where the city's commuter belt begins. But the reason it is in a learner's dictionary is the joke phrase "north of Watford" (also "Watford Gap").

When a Londoner says "north of Watford", they do not mean geography. They mean: out there, far away, a place I know nothing about and secretly think does not matter. "They've never heard of it north of Watford." "You can't get a decent coffee north of Watford." Watford works as the joke because it is the last place a Londoner can name before their mental map runs out — everything beyond it blurs into one vague "the North".

So the phrase is really about London, not about the North. It is used two ways. A Londoner may use it lightly, half joking about their own narrowness. Someone from Manchester or Leeds may use it sharply, to point at that narrowness: "As usual, the government forgets anything north of Watford." That second use has real feeling in it — a long-standing complaint that money and attention stay in the south. Knowing which one is happening is the whole skill.

This is deep British English. It will not be understood in America or Australia, and you should recognise it far more often than you use it.