Watto was a Toydarian junk dealer in Mos Espa who bought Shmi Skywalker and her son Anakin from Gardulla the Hutt. An inveterate gambler, he sponsored Anakin in several Podraces, but often bet against his own slave, who was talented but inexperienced.

He provided his slaves with their own hovel on Slave Quarters Row, which the Skywalkers appreciated greatly. To ensured that his slaves did not try to escape, Watto had an explosive chip installed in each of them, that would detonate should they make any attempt to free themselves. Watto made a habit of scolding his slaves so much so that it became a daily part of their lives.