Background: Transcutaneous auricular vagus nerve stimulation (taVNS) is a non-invasive neuromodulation technique with promising therapeutic potential in the context of epilepsy, pain, and depression and which may also have beneficial effects on social cognition. However, the underlying mechanisms of taVNS are unclear and evidence regarding its role in social cognition improvement is limited. Objective: In order to investigate the impact of taVNS on social cognition we have studied its effects on gaze towards emotional faces using an eye-tracking task and also on release of the neuropeptide oxytocin which plays a key role in influencing social cognition and motivation. Methods: A total of fifty-four subjects were enrolled in a sham-controlled, participant-blind crossover experiment, consisting of two treatment sessions, separated by one week. In one session participants received 30-min taVNS (tragus), and in the other, they received 30-min sham (earlobe) stimulation with the treatment order counterbalanced across participants. Gaze duration towards the faces and facial features (eyes, nose, and mouth) were measured together with resting pupil size. Additionally, saliva samples were taken for the measurement of oxytocin concentrations by enzyme-linked immunoassay. Results: Saliva oxytocin concentrations increased significantly after taVNS compared to sham stimulation, while resting pupil size did not. In addition, taVNS increased fixation time on the nose region irrespective of face emotion, and this was positively correlated with increased saliva oxytocin concentrations. Conclusion: Our findings suggest that taVNS biases visual attention towards socially salient facial features across different emotions and this is associated with its effects on increasing endogenous oxytocin release.