The winning margin may have been narrow but Otley's much needed win was essential in the battle to avoid the drop.
Otley's performance was gritty and robust while the finishing and conversion of opportunities was much improved. In addition, the line-out was efficient and the scrummage remained rock solid.
Jon Benson had an early chance to give his side the lead but pushed his attempt wide and Otley then worryingly fell behind after 10 minutes.
Waterloo maintained possession for several phases before centre Freeman Payne made an outside break before switching back inside to fly-half Anders Munro to go over next to the posts. Munro bizarrely missed the simple conversion but Waterloo led 5-0.
From the re-start Waterloo infringed after a speculative kick ahead by Otley's Danny Smith and Benson this time converted the penalty chance to make it 5-3.
Waterloo were soon back on the attack and scored their second try when scrum-half Chad Erskine broke away from the scrum 5 yards out to dart in at the corner. This time Munro converted from the touchline to make it 12-3.
Otley retained their composure and more importantly the possession which they were winning. They were rewarded just before half-time after forwards and backs combined to take play into the home 22. With the Waterloo defence stretched, the ball was shipped to the left and a long miss pass found left winger Danny Smith who shot in at the corner. Benson just failed with the conversion attempt but Otley had reduced the arrears to 12-8 at half-time.
Otley grabbed the lead soon after the restart when a poor clearance kick was taken by Ian Shuttleworth who transferred the ball to the right with a long pass to Xavier Andre who found himself in space 35 metres out. Andre stepped on the gas to outpace the initial defenders before crashing through two attempted tackles and diving over the line for a brilliant score. Benson could not convert but Otley had importantly taken the lead at 12-13.
After 55 minutes, replacement No.8 Matt Stockdale broke quickly from the scrum and attacked the Waterloo midfield. He fed onto centre Rob Whatmuff who made another powerful run into the heart of the Wateroo defence and the ball was recycled quickly. Jon Benson delivered the perfect pass to the onrushing Danny Smith who sliced through to score from 25 metres out. Benson added the conversion to make it 12-20 to Otley.
Otley were starting to command proceedings and the forwards were soon battering away at the Waterloo line. To most onlookers second-row Sean Tomes had squeezed the ball over the line for a try which would have secured the bonus point but the try was not awarded and then Otley were hit with a double whammy when Tomes was sent to the sin-bin - no bonus point try, Waterloo cleared their lines and Otley were down to 14 men with 15 minutes left.
Waterloo rallied but Otley's defence stood firm. Payne broke clear with 5 minutes remaining but a last ditch tackle by Shuttleworth cut him down inches short under the cross-bar and a knock-on followed as Payne stretched for the line.
With the last play of the game, Waterloo scored a consolation try in the corner to earn themselves a bonus point but the most important news of the afternoon was that Otley had earned a vital four league points.
A well-earned victory based around strong defence, a strong set-piece and clinical finishing.
Waterloo: Murchie, Kerfoot, Payne (capt), Sliczny (Davies 77), Van Deventer, Munro, Erskine, O'Keefe (Hopwood 7-12, 53), Peter Ince (Tyms 61), Prescott (O'Keefe 63), Townson, O'Donnell, Planchant, Palmer (Smith 73), McKay
Otley: Shuttleworth (capt), Andre, Dench, Whatmuff, Smith, Benson, Brown, Turner, Steele, Fear, Parr, Tomes, Connor (Stockdale 55), Hyde, Tiffany (Bland 71)
Referee: G Copsey (RFU)
MATCH STATISTICS
Waterloo 17
Tries: Munro, Erskine, Townson
Cons: Munro
Otley 20
Tries: Smith (2), Andre
Cons: Benson
Pens: Benson
Oscar's Gamestar: Dan Hyde
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