Staphylococcus aureus, a commensal on the skin and in the nasal cavity of humans, is one of the most serious cases of nosocomial infections. Moreover, methicillin-resistant S. aureus (MRSA) is a leading cause of morbidity and mortality worldwide. For the treatment of MRSA infections, vancomycin is considered as a drug of choice. However, the emergence of vancomycin resistance among MRSA isolates has been perceived as a formidable threat in therapeutic management. To estimate the rate of vancomycin-resistant S. aureus (VRSA) and to detect the vancomycin-resistant genes, namely, vanA and vanB, among the isolates, a hospital-based cross-sectional study was conducted from July to December 2018 in Annapurna Neurological Institute and Allied Science, Kathmandu, Nepal. S. aureus was isolated and identified from different clinical samples and processed for antibiotic susceptibility testing by the modified Kirby–Bauer disc diffusion method. The screening of MRSA was performed as per Clinical and Laboratory Standard Institute (CLSI) guidelines. VRSA was confirmed by the minimum inhibitory concentration (MIC) method by employing E-test strips. All the phenotypically confirmed VRSA were further processed to detect the vanA and vanB gene by using the conventional polymerase chain reaction (PCR) method. A total of 74 (20.3%) S. aureus were isolated, and the highest percentage of S. aureus was from the wound samples (36.5%). Of 74 S. aureus isolates, the highest number (89.2%) was resistant to penicillin, and on the other hand, linezolid was found to be an effective drug. Likewise, 45 (60.81%) were found to be MRSA, five (11.11%) were VRSA, and 93.2% of S. aureus isolates showed an MAR index greater than 0.2. Two VRSA isolates (40%) were positive for the vanA gene. The higher prevalence of MRSA and significant rate of VRSA in this study recommend routine surveillance for the MRSA and VRSA in hospital settings before empirical therapy.