These watch gaskets are made of specialty rubber or neoprene, and sometimes from plastic for crystals. Watches have gaskets because they protect your watch from things like dust, water, perfume, oils, dirt, and other residues that wristwatches and pocket watches are exposed to.
Gaskets are the most important in watches that act as a water resistance. Many proficient watch repairers use a compression fitted crystal gasket, this will restrict the flow of water.