Watts discussed her thrilling new role with "Early Show" co-anchor Harry Smith.
When former CIA agent Valerie Plame's identity was published in a newspaper column five years ago, an investigation traced the leak all the way to the White House and it became apparent this was no ordinary spy story.
Her cover was blown after her husband - former ambassador Joe Wilson - criticized the Bush administration about the Iraq war.
"It stands alone, even without the truth involved, this -- it feels like something for the movies," Watts said.
Although Watts had just given birth to her second child, the script was just too enticing for her to turn down.
"It could have not have been the worst timing. Basically December 13th, I gave birth and the e-mail came on the 26th and I said, 'Look, I'm not reading anything right now. And I'm on the two-hour feeding schedule.' And I knew, obviously, the story, I'd followed it well at the time. So, I was instantly intrigued and he said 'Just read 10 pages...have a look at 10 pages,'" she said.
From there it was all over -- and Watts was on board.
Watts was surprised by how much more she learned about the story and what she learned when she was able to see Plame as a person, rather than just a headline.
Smith pointed out, Plame's story is not only about public life, but also about the private anguish of Plame's family that is almost torn asunder by the scandal.
"Yes. And that's what I loved about the script reading, was that you have a way in, it's set against these political events that we have to relive, which is disturbing. But, you get to be inside the privacy of their own home and see how it affects them as a couple," she said.
Watts had the oppotunity to meet Valerie Plame.
So what is she really like in real life? Was she penetrable?
"She's not someone that's easy to get things out of. She still has a secrecy agreement with the CIA. So those questions you just saw in the clip, the temptation to ask those questions, is there," she admitted.
"But, you know, she's not going to answer those so you just kind of have to push all that stuff aside. The research was very extensive - what the writers came up with, and so I went with the facts available," Watts added. "But then, wanting to just get into the mindset of who she was and in dealing with this crisis and, as a mother, a professional, a wife, you know, all those things...the personal stuff."
Plame is almost like a soccer mom who happens to be a secret agent.
"If you met her in a social setting, you would never know that she could take you out in three seconds," said Watts, who had some paramilitary training for the role.
Watts' "21 Grams" co-star and friend, Sean Penn wasn't originally involved in the film, but she and the screenwriters and directors wanted him to be involved.
And then, with a small window of opportunity, the directors said, 'Let's cut out all the middlemen,' and Watts sent the script directly to Penn, "knowing this content would really -- kind of be irresistible to him," she said.
Penn plays her husband, Joe Wilson.
"Immediately I got a message back from him saying great script, a necessary story to tell."
"Fair Game" opens in theaters Friday, Nov. 5.