The plans include building 700 homes, a new business park and a hospital in West Watford.
Speaking at the event mayor of Watford Dorothy Thornhill said: "We’ve all been here before, we’ve launched things, but this evening is saying ‘it is going to happen, a significant part of West Watford will be regenerated’.
"We will have the infrastructure, the road, the new facilities, it will be a place people are proud to live. It will uplift the whole area around it.
"But we have to win the hearts and minds of the people of Watford. If you can’t build on derelict land where can you build?"
An exhibition of the plans will take place on Friday and Saturday in the football club’s corporate lounge, and Thursday January 30 in the Town Hall.
The extent of the development’s use of the Farm Terrace Allotments was also revealed by the new masterplan.
The use of the allotments will be subject to a separate planning application, due to the site’s "sensitivities".
Last year, the Department of Communities and Local Government gave Watford Borough Council permission to build on Farm Terrace for a second time.
The initial permission had been revoked after a legal challenge from allotment campaigners.
Farm Terrace had initially been protected in the development, but council said it was needed to make the project economically viable.
Sara Jane Trebar from the Farm Terrace Community Association described the separate application as "another very positive thing" but described the masterplan as "very hurtful".
She added: "Originally the council wanted the top part of the allotment to build the larger houses on it.
"[The masterplan] is a perfect example of what we said all along, there will be no hospital building on the allotments.
"It’s adding insult to injury building a car park on the top terrace. They didn’t mention that in the legal papers they sent to the secretary of state.
"They are paving paradise and putting up a parking lot. The community space they are promising is diminishing with every plan, it is getting smaller and smaller.
"Some people don’t care about the allotments but they do care about the extra traffic and the pressure of infrastructure. Firstly this was for 600 homes, then 650, now 700."
Kathryn Robson, from Watford Borough Council, refuted the claims and suggested up to 40 per cent of the allotment site could be used for possible hospital development.
MP for Watford Richard Harrington said: "From my point of view it is my job to look for the whole of Watford and the way it develops. It is going to be a 21st century town. A world class town.
"Dorothy and I might not be Boris Johnson and David Cameron but we are Watford’s equivalent."
You can view the masterplan image here: Plan PDF.pdf