This paper considers the effect of imperfect vaccination in a susceptible-infected-removal (SIR) epidemic model. The minimum proportion of the population that needs to be vaccinated to prevent a major epidemic depends on the vaccine efficacy and the basic reproductive rate for the SIR model, allowing for imperfect and variable vaccination. Martingale theory is used to derive estimates and associated standard errors for these parameters. Asymptotic properties of the resulting estimators are investigated. Data for a mumps outbreak are used as an illustrative example.