The actress, who has been dating New York-based actor Liev Schreiber for almost two years, wore a lemon coloured gown with dropped sleeves.

What had the gossips whispering was Watts' gown's empire waist, combined with a maroon sash below the bust, that appeared to be covering her stomach.

People magazine reported a representative of Escada, which designed Watts's Oscar gown, issued a press release reading in part, "The ESCADA gown set off her most precious new asset - the baby she is expecting with longtime boyfriend Liev Schreiber."

"Did a fashion publicist just out Naomi Watts as a mom-to-be?" the magazine asked on its website. "What a way to spill the beans on a bump."

Last week the New York Post quoted unnamed "friends" confirming the pregnancy.

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