Pictured to the left: Breitling Bentley Flying B Men's Automatic Watch, made of 18K Rose Gold, Amber Dial on a Brown Leather Strap (Breitling watches are made in the Canton of Jura, near the center of the Swiss watch industry)
The mere term "Swiss watch" always has a certain level of prestige and recognizability, like Tahitian pearls, German cars, Japanese electronics, and Belgian chocolate. Switzerland is famous for its reliable and precise timepieces. The French portion of the country is particularly associated with the industry, due to highly visible brands such as Rolex and Patek Philippe. However, the German region is known for some famous brands as well, such as IWC, the international watch company that is credited with inventing the first waterproof case for a watch.
Strangely enough, the luxury watch industry in Switzerland began due to a ban on wearing jewelery. Jean Calvin, a Protestant Reformer, was a minister based in Geneva, and his anti-materialistic stance forced goldsmiths and other artisans to redirect their talents into forging new objects: watches. In 1601, the Watchmakers' Guild of Geneva formed, and about a 100 years later, watchmakers left for the Jura Mountains to escape the overwhelming competition in the large Swiss city.
In the nineteenth century, the industry exploded due to technological advancements that allowed for timepieces to become truly sophisticated. Louis Audemars created stem winding and setting mechanism in 1838, and 30 years later Patek Philippe invented the first wristwatch. These Swiss manufacturers did not stop their innovations (such as Girard-Perregaux making the first high-frequency mechanical watch in 1966) of their dedication to creating truly luxurious watches.
Sources: Federation of the Swiss Watch Industry (http://www.fhs.ch/en/history.php), "Watch History: Watch development through the ages" (http://www.which-watches.com/history.html)