The British number two has only won twice in five appearances at the first Grand Slam of the year, but former US Open champion Stosur has also been relatively unsuccessful in Melbourne after reaching the fourth round on just two occasions.
Despite the prospect of playing in front of a crowd who will favour Stosur, Watson has said that she is fully focused on playing her own game against the former world number four.
The 25-year-old is quoted by BBC Sport as saying: "I look forward to playing Sam. She's a great player with an all-round game.
"All the talk will be about her playing in front of her home crowd but I just want to focus on myself and play my game as best as I can. I'm feeling healthy, fit and ready to go now."
Watson will begin the tournament ranked in 81st place in the world rankings.