In Terraria, I have a watch in my hotbar. I always keep it there, but the last time I looked, it won't show the time anymore. Is this a glitch, or what's happening with the watch?
As long as you have the Watch in your inventory (it doesn't need to be on your hotbar, just having it with you is enough) you should be able to see the time displayed underneath your minimap in the top right of the screen:
Do bear in mind though - the information will only display while your inventory is closed. You may also enable/disable individual info items by clicking their icon while the inventory is open:
In the above image everything is enabled, whereas below, time is disabled:
If you can't see the time, check that you haven't accidentally disabled it by looking at the icon. If it's disabled, simply click it to re-enable it.