The Moroccan international had an excellent debut season with Palermo last term.
It is being reported that Watford have not forgotten about attempting to bring in yet another new left-back this summer.
They have already signed the Greek international Jose Holebas from AS Roma and now want another to supplement the position.
The Moroccan international, who can also play on the left-wing, signed for the club in 2014 from Varese and has gone on to impress at the club.
He is also wanted by AS Monaco, who are fretting over the future of their current left-back Layvin Kurzawa. Any troubles over a work permit would be unlikely. Lazaar has lived in Italy since 2003 so would be free to play in England.
Watford have previously been linked with Davide Santon and Ali Adnan in the left-back position this summer, with neither move happening.
Much depends on what system Watford end up adopting this term. They have been known to play with wing-backs, which would see the likes of Ikechi Anya, Miguel Layun and Daniel Pudil come into their own.
However, Quique Sanchez Flores clearly wants options for all eventualities and formations, with Lazaar the latest apparent target.