"I suppose I was just thinking, 'That'd be a good way to start a comic book: have a famous super-hero found dead.' As the mystery unraveled, we would be led deeper and deeper into the real heart of this super-hero's world, and show a reality that was very different to the general public image of the super-hero."Alan Moore on the basis for Watchmen
In 1985, DC Comics acquired a line of characters from Charlton Comics. During that period, writer Alan Moore contemplated writing a story that featured an unused line of superheroes that he could revamp, as he had done in his Miracleman series in the early 1980s. Moore reasoned that MLJ Comics' Mighty Crusaders might be available for such a project, so he devised a murder mystery plot which would begin with the discovery of the body of the Shield in a harbour. The writer felt it did not matter which set of characters he ultimately used, as long as readers recognized them "so it would have the shock and surprise value when you saw what the reality of these characters was". Moore used this premise and crafted a proposal featuring the Charlton characters titled Who Killed the Peacemaker, and submitted the unsolicited proposal to DC managing editor Dick Giordano. Giordano was receptive to the proposal, but opposed the idea of using the Charlton characters for the story. Moore said, "DC realized their expensive characters would end up either dead or dysfunctional." Instead, Giordano persuaded Moore to continue with new characters. Moore had initially believed that original characters would not provide emotional resonance for the readers, but later changed his mind. He said, "Eventually, I realized that if I wrote the substitute characters well enough, so that they seemed familiar in certain ways, certain aspects of them brought back a kind of generic super-hero resonance or familiarity to the reader, then it might work."
Artist Dave Gibbons, who had collaborated with Moore on previous projects, recalled he "must have heard on the grapevine that he was doing a treatment for a new miniseries. I rang Alan up, saying I’d like to be involved with what he was doing," and Moore sent him the story outline. Gibbons told Giordano he wanted to draw the series Moore proposed and Moore approved. Gibbons brought colorist John Higgins onto the project because he liked his "unusual" style; Higgins lived near the artist, which allowed the two to "discuss [the art] and have some kind of human contact rather than just sending it across the ocean". Len Wein joined the project as its editor, while Giordano stayed on to oversee it. Both Wein and Giordano stood back and "got out of their way"; Giordano remarked later, "Who copy-edits Alan Moore, for God's sake?"
After receiving the go-ahead to work on the project, Moore and Gibbons spent a day at the latter's house creating characters, crafting details for the story's milieu and discussing influences. The pair was particularly influenced by a Mad parody of Superman named "Superduperman"; Moore said, "We wanted to take Superduperman 180 degrees—dramatic, instead of comedic". Moore and Gibbons conceived of a story that would take "familiar old-fashioned superheroes into a completely new realm"; the writer said his intention was to create "a superhero Moby Dick; something that had that sort of weight, that sort of density". The writer came up with the character names and descriptions, but left the specifics of how they looked to Gibbons. Gibbons did not sit down and design the characters deliberately, but rather "did it at odd times ... spend[ing] maybe two or three weeks just doing sketches." Gibbons designed his characters to make them easy to draw; Rorschach was his favorite to draw because "you just have to draw a hat. If you can draw a hat, then you've drawn Rorschach, you just draw kind of a shape for his face and put some black blobs on it and you're done."
Moore began writing the series very early on, hoping to avoid publication delays such as those faced by the DC limited series Camelot 3000. When writing the script for the first issue, Moore said he realized, "I only had enough plot for six issues. We were contracted for 12!" His solution was to alternate issues that dealt with the overall plot of the series with origin issues for the characters. Moore wrote very detailed scripts for Gibbons to work from. Gibbons recalled that "[t]he script for the first issue of Watchmen was, I think, 101 pages of typescript—single-spaced—with no gaps between the individual panel descriptions or, indeed, even between the pages." Upon receiving the scripts, the artist had to number each page "in case I drop them on the floor, because it would take me two days to put them back in the right order", and used a highlighter pen to single out lettering and shot descriptions; he remarked, "It takes quite a bit of organizing before you can actually put pen to paper." Despite Moore's detailed scripts, his panel descriptions would often end with the note "If that doesn't work for you, do what works best"; Gibbons nevertheless worked to Moore's instructions. In fact, Gibbons only suggested a single change to the script: a compression of Ozymandias' narration while he was preventing a sneak attack by Rorschach, as he felt that the dialog was too long to fit with the amount of action expressed; Moore agreed and re-wrote the scene. Gibbons had a great deal of autonomy in developing the visual look of Watchmen, and frequently inserted background details that Moore admitted he did not notice until later. Moore occasionally contacted fellow comics writer Neil Gaiman for answers to research questions and for quotes to include in issues.
Despite his intentions, Moore admitted in November 1986 that there were likely to be delays, stating that he was, with issue five on the stands, still writing issue nine. Gibbons mentioned that a major factor in the delays was the "piecemeal way" in which he received Moore's scripts. Gibbons said the team's pace slowed around the fourth issue; from that point onward the two undertook their work "just several pages at a time. I'll get three pages of script from Alan and draw it and then toward the end, call him up and say, 'Feed me!' And he'll send another two or three pages or maybe one page or sometimes six pages." As the creators began to hit deadlines, Moore would hire a taxi driver to drive 50 miles and deliver scripts to Gibbons. On later issues the artist even had his wife and son draw panel grids on pages to help save time.
Near the end of the project, Moore realized that the story bore some similarity to "The Architects of Fear", an episode of The Outer Limits television series. The writer and Wein argued over changing the ending, and when Moore refused to give in, Wein quit the book. Wein explained, "I kept telling him, 'Be more original, Alan, you've got the capability, do something different, not something that's already been done!' And he didn't seem to care enough to do that." Moore acknowledged the Outer Limits episode by referencing it in the series' last issue.