The 18-year-old will provide cover for Luke Daniels, who starts a three-match ban for his red card in the opening day defeat at Burton on Saturday.
Watson, who is yet to make his Tigers debut, could feature for the Iron in Tuesday's League Cup tie with Barnsley.
He tweetd: "Delighted to have joined Scunthorpe on a month's loan. Looking forward to getting started tomorrow."
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Scunthorpe United have signed Hull City goalkeeper Rory Watson on a 28-day emergency loan.