Background: In South Korea, the one-dose varicella vaccine was included in the National Immunization Program for children aged 12-15 months in 2005, and the vaccine coverage reached >95%. The impact of varicella vaccination on varicella and herpes zoster (HZ) was investigated, accounting for demographic changes over time. Methods: We calculated the crude and age-sex standardized incidence rates (IRs) and age-specific IRs of varicella and HZ from 2003 to 2015, using the National Health Information Database including approximately 50 million Koreans. The annual incidence rate ratios (IRRs) were calculated using a negative binomial regression analysis, adjusting for age and sex. Results: The crude varicella IR steadily declined by 67%, from 5.70/1000 to 1.87/1000 person years (IRR per year: 0.91; 95% CI 0.89-0.93), but the adjusted IRs showed a significant decline only during 2010-2015 (adjusted IRR per year: 0.90; 95% CI 0.88-0.93). The greatest decline was found in children ≤4 years of age, whereas the IR increased until 2011 and then declined afterward in children aged 5-9 years, who represented the highest incidence age group in 2013-2015. The crude HZ IR increased from 2.67/1000 to 9.80/1000 person years (IRR per year: 1.12; 95% CI 1.10-1.15), and the adjusted IR also followed the same trend. A similar increasing trend was observed before and after universal vaccination. Conclusions: One-dose varicella vaccination was moderately effective in preventing varicella, but this strategy was insufficient to interrupt varicella transmission in children. Furthermore, the HZ incidence dramatically increased over this decade. The current vaccination strategy against varicella-zoster disease should be reconsidered.