Objectives To examine the impact of COVID-19 vaccination on hospital admissions in England in 2021. Design Observational study of emergency admissions for COVID-19 by vaccination status in people 16 years and over in England. Setting Hospitals in England. Participants A total of 48.1 million people registered with an English GP, aged ≥16 years with a recent NHS contact. Main outcome measures Emergency hospital admissions with a primary diagnosis of COVID-19 between 1 January and 31 December 2021. Monthly admission rates were directly standardised for age, sex, risk category and vaccination dose to estimate vaccine effectiveness (VE) over time, between vaccine doses, age groups and risk groups. Results A total of 192,047 hospital admissions were included. The unvaccinated admission rate was higher in December 2021 (6.1 admissions per 100,000 person-days; 95% CI: 5.9 to 6.3) than January 2021 (4.9; 95% CI: 4.9 to 5.0). Vaccinated admission rates were ≤1 per 100,000 from February to December. Doses 1 and 2 VE waned over time, particularly in older and clinically vulnerable groups (although this may reflect that they were vaccinated earlier). Dose 3 VE remained above 93%. Conclusions COVID-19 hospitalisations were consistently highest in the unvaccinated. Despite high case rates at the end of 2021, overall admission rates remained stable, driven by low admission rates among vaccinated people. There is population-level waning in VE, recovering after subsequent doses, potentially more marked in older and at-risk groups. The findings support JCVI (Joint Committee on Vaccination and Immunisation) guidance for an ongoing booster programme, especially in older people and higher clinical risk groups.