Background: Few studies have evaluated COVID-19 vaccine effectiveness (VE) in middle-income countries, particularly in eastern Europe. We aimed to estimate COVID-19 VE against SARS-CoV-2-confirmed hospitalizations and severe outcomes in Kosovo. Methods: We conducted a test-negative case-control study using data from Kosovo’s severe acute respiratory infection (SARI) sentinel surveillance system from January 2022 to June 2024. We enrolled adult patients aged ≥18 years hospitalized with SARI. From all patients, we collected clinical data, vaccination history and a nasopharyngeal specimen, which was tested for SARS-CoV-2 using RT-PCR. SARS-CoV-2-positive patients were cases; those testing negative were controls. We estimated VE overall and against severe outcomes (requiring oxygen, intensive care admission, or in-hospital death) using logistic regression, adjusting for age, sex, and comorbidities, calculating VE as (1–adjusted odds ratio)×100. Results: We included 564 SARI patients; 218 (39%) tested positive for SARS-CoV-2. Overall, 24% of SARI patients had received at least one COVID-19 vaccine dose in the previous 12 months. VE against SARS-CoV-2-confirmed SARI hospitalization among all adults was 75% (95%CI:37–90%) at 14–179 days post-vaccination, and 24% (95% CI:-35–58%) at 180–364 days. In adults ≥60 years, VE was 59% (95%CI:-10–84%) at 14–179 days post-vaccination, and -37% (95%CI:-188–5%) at 180–364 days. VE against severe outcomes was 70% (95% CI:-2–91%) at 14–179 days, and 8% (95%CI:-128–63%) at 180–364 days. Conclusions: In Kosovo, COVID-19 vaccination offered significant protection against hospitalization and severe outcomes. Effectiveness waned after 6 months, highlighting the need for periodic booster doses.