The 48-year-old actor said she is great friends with the director, reported FemaleFirst.
"I'm very proud of that film ('Mulholland Drive'). It changed my life in so many ways, not just because of my career.
"David Lynch is one of my mentors. He's a great, great friend. And I'm really proud to be in a film that's still being discussed and acknowledged, and it doesn't surprise me. People do talk about this film to this day, endlessly, wherever I go," Watts said.
The actor and director have reunited for the revival series of "Twin Peaks".
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