The Gunners have numerous defensive concerns ahead of Saturday's Premier League encounter, with Mustafi having picked up a long-term injury while playing for Germany while Koscielny has been out with an Achilles problem.
Sanchez has three goals and three assists in five lifetime matches against Watford, while Ozil has a goal and three assists in five contests.
The Hornets suffered a heavy 6-0 defeat at the hands of Manchester City in their last Premier League clash before the worldwide break.
Alexandre Lacazette to continue his fine goal scoring run and claim the first goal is 15/4.
The 20-year-old Hornets wide-man has been an instant hit since being introduced to the Watford faithful, providing the team with three goals and an assist since his move from Fluminense.
The summer signing found himself out of the side towards the end of August, but the French worldwide now has four goals from eight appearances and is now regarded as one of the first names on the teamsheet.
Arsene Wenger revealed that Sanchez was in a "difficult place" after his country Chile failed to qualify for the 2018 World Cup. The 25 year-old, who is not expected to return until November was almost sold by Arsene Wenger this summer.
Mesut Ozil and Danny Welbeck are both available again after recovering from injury problems, while Alexis Sanchez and Aaron Ramsey will be assessed after returning from a disappointing worldwide break where Chile and Wales both missed out on the World Cup.
Arsenal are strong favourites to win this game with the bookies, at 3/5.
The Gunners pushed on in the second half, dragging one back through Alex Iwobi in the 58th minute, but it wasn't enough in this sodden contest as Watford ran away with the historic win over their London rivals.
Watford have been excellent this season, but they are perhaps facing Arsenal at the wrong time.
"Jack is in the best form I've seen him in for a long time", Wenger said.