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In this video tutorial, the presenter explains how to remove a watermark in Microsoft Word. The example given involves a document with a "draft" watermark, but other common watermarks may include labels like "confidential" or "urgent." After completing work on the document, users often wish to eliminate the watermark. The video advises against double-clicking the watermark to remove it, as that method does not work. Instead, users should navigate to the "Design" tab, click on the watermark drop-down arrow, and select "Remove Watermark" to successfully remove it.