Taylor's passing in January at the age of 72 sparked tributes from across the world of football and Watford have decided to play an annual pre-season fixture for the 'Graham Taylor Trophy' against other teams coached by the former England boss.
Taylor, who started his career with Lincoln, led Watford on a magical ride from the lower reaches of English football to the top-flight and an FA Cup final appearance.
He left Watford for the Villa job in 1987, winning promotion to the First Division a year later before going on to take charge of England in 1990.Â
Taylor also managed Wolves before returning for a second successful spell with Watford and finishing his career back at Villa, where he retired after the 2002-03 season.
"Watford will host Aston Villa on Saturday July 29 at Vicarage Road (3pm kick-off), in a special memorial matchday for the late Graham Taylor OBE," a Watford statement read on Thursday.
"At the request of his family, profits from the friendly will be split evenly between two charities Graham had a close connection to -- the National Memorial Arboretum and the Hornets' self-financing registered charity, the Watford FC Community Sports and Education Trust."