The association between rotavirus gastroenteritis (RVGE)-associated hospitalization and rotavirus vaccine receipt was examined, and vaccine effectiveness was estimated in a case-control study conducted between 11/2007 and 12/2009 among Israeli children age eligible for rotavirus vaccination. Cases (n=111) were hospitalized children with diarrhea testing positive for rotavirus by immunochromatography. Controls (n=216) were hospitalized children with diarrhea testing negative for rotavirus. Among controls 36 (16.7%) children were vaccinated against rotavirus compared with two children (1.8%) among cases (p < 0.001). Rotavirus immunization was associated with lower risk of RVGE-associated hospitalization; adjusted OR 0.106 (95% CI 0.024, 0.481), yielding a vaccine effectiveness of 89.4% (95% CI 51.9%, 97.6%) in preventing hospitalization. These data demonstrate high effectiveness of rotavirus vaccines in a high income country.