The star is being treated at a private hospital in Greater Manchester.
The singer, who had a benign brain tumour removed last year, was recording on Wednesday when he was taken ill.
Michael Stroud from the Alexandra Hospital in Cheadle said it was a "difficult" time for Watson's family and thanked fans for their good wishes.
Tumour returned
Mr Stroud said Watson was rushed to the hospital on Wednesday evening from a recording studio after becoming suddenly incapacitated.
He had a number of symptoms, including a "dramatic deterioration of vision".
An MRI scan revealed a re-growth of the previous tumour, accompanied by bleeding.
Watson's agent Giles Baxendale said on Thursday evening that the Salford-born singer faced a crucial 48 hours.
"It's been a tough day. He looks pretty grim. He's alive, that's the main thing," said Mr Baxendale.
"He's out and in intensive care. He's in a critical condition still and going to stay in intensive care for at least 24-48 hours.
"He's in and out of consciousness. He's spoken. He was having waves of consciousness."
Mr Baxendale thanked Watson's fans for their "overwhelming support" for the singer.
Watson, who used to be a factory worker before he turned to singing, has sold more than four million albums worldwide. The tenor has two daughters, aged seven and 12.
A message on Watson's official website confirmed "with much sadness" that the star was "in a critical condition".
"All our hopes, prayers and wishes are with him," it added.
'Worried sick'
Watson's manager Richard Thompson said: "Our thoughts are with Russell and his family."
Fans on Russell Watson UK, an unofficial fan site, posted their good wishes.
"I'm worried sick, I was in tears when I found out. Please God, get him through this," wrote one fan called Johanna.
Another posted: "This is such a shock, I am totally devastated. Dear Russell, my heart is going out to you with all the prayers to ask God to help you through this."
Watson had an operation to remove a benign brain tumour, called a pituitary adenoma, in September 2006.
The surgery took place at St George's Hospital in south London.
He recovered but was forced to cancel television appearances and postpone a UK tour.
New album
All of Watson's engagements have been put off until further notice
The singer was due to perform before the American football match between the Miami Dolphins and the New York Giants at Wembley Stadium on Sunday.
Next week he was set to fly to Los Angeles to appear at a Bafta ceremony honouring British artists in the US.
His latest album, Outside In, is due for release on 26 November.
Watson found fame after the chairman of Manchester United invited him to sing Nessun Dorma ahead of the football team's last match of the season in 1999.
He received a standing ovation and later landed a recording contract.
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