What's the best mechanical watch under $500?
The Seiko 5 SRPD55 ($300) and Tissot Gentleman Powermatic 80 ($475) are the most-recommended mechanical watches under $500. The Seiko offers 100m water resistance, 41mm case, automatic Caliber 4R36, and a day-date complication. The Tissot offers Swiss-made manufacture, 80-hour power reserve automatic movement, and dressier proportions for formal wear. For dive-watch utility, the Citizen NY0040 Promaster Diver ($350) provides 200m water resistance and solar-powered Eco-Drive (technically quartz, not mechanical, but exceptionally durable).
The recommendations
Seiko 5 SRPD55 / SRPD63 ($300)
The most-recommended sub-$500 mechanical watch. 41mm case, 100m water resistance, automatic Caliber 4R36 (24-jewel, hand-windable, hackable), day-date complication. Sold for under $300 from authorized retailers. The Seiko 5 line has been in continuous production since 1963; the SRPD references are the modern dive-watch-aesthetic variants. The 4R36 movement is the workhorse Seiko caliber and runs reliably for decades with proper service.
Tissot Gentleman Powermatic 80 ($475)
Swiss-made dress automatic. 40mm case, 100m water resistance, Powermatic 80 movement (80-hour power reserve, ETA-based but Tissot-modified). Available with multiple dial colors and bracelet/strap configurations. Tissot is part of the Swatch Group and benefits from Group movement supply. The Powermatic 80 sits between standard ETA and chronometer-grade movements in finishing.
Citizen NY0040 Promaster Diver ($350)
The "Fugu" diver. 41mm case, 200m water resistance, automatic Citizen 8203 movement, ISO 6425 certified for actual diving use. The Fugu nickname references the cushion case shape resembling a pufferfish. Citizen produces NY0040 in dozens of colors and bezel variants. One of the best dive-watch values in horology under $500.
Orient Mako II / Ray II ($300)
Japanese mechanical dive watch. 42mm case, 200m water resistance, Orient F6922 in-house movement, hackable and hand-windable. Orient is owned by Seiko Group; Mako II/Ray II compete directly with Seiko 5 dive references at slightly lower price points. Gold value for the budget-conscious dive-watch buyer.
Hamilton Khaki Field Mechanical ($495)
Hand-winding field watch. 38mm case, 50m water resistance, ETA 2801-derived H-50 movement (80-hour power reserve), military aesthetic. Hamilton is part of the Swatch Group and Hamilton Khaki Field is the most accessible American-heritage Swiss-made watch. Available in 38mm or 42mm with various dial colors. The Khaki Field is the most-recommended sub-$500 hand-winding watch.

Photo by Francis Flinch via Wikimedia Commons, CC BY-SA 3.0