In 1927 Rolex launched the first reliable water resistant watch - the Rolex Oyster. Even though it was an impressive technological achievement, it didn't take long for Cartier to also release a model with equivalent capabilities.
The next big leap was introduced by Omega in 1932. Thanks to an external case, the Marine model could resist the equivalent to a depth of 135 m, which was enough for what divers of that time needed.
The invention of the Aqua-lung breathing apparatus in 1942 made diving much more popular. This event pushed the watch industry to innovate, and the response came from brands like Panerai, Blancpain, Rolex, and Doxa.
In 1996 the ISO 6425 was introduced to clearly define what a diver's watch should contain. However, the industry usually accepts the "diver" label if a watch has: a one side rotatable diving bezel; water resistance of at least 20 bar; waterproof bracelet; screw-down crown; and decently long lasting lume.