There is a notable lack of vaccine effectiveness studies using test-negative case-controlled approach in low- and middle-income countries which have different logistic, demographic and socio-economic conditions from high-income countries. We aimed to estimate the effectiveness of BNT162b2 vaccine against COVID-19 infection over time, intensive care unit admission, severe or critical disease and death due to COVID-19. This study was conducted in the resident population of Labuan aged ≥18 years who had been tested for SARS-CoV-2 by Reverse-Transcriptase Polymerase Chain Reaction between 1 March 2021 and 31 October 2021. We used a test-negative case-control design where 2644 pairs of cases and controls were matched by age, sex, testing date, nationality and testing reason. Analysis was stratified by age group to estimate age effect (<60 years and ≥60 years). Of 22217 individuals tested by Reverse-Transcriptase Polymerase Chain Reaction, 5100 were positive for SARS-CoV-2 and aged 18 years and above. Overall vaccine effectiveness ≥ 14 days after the second dose was 65.2% (95% CI: 59.8–69.9%) against COVID-19 infection, 92.5% (95% CI: 72.3–98.8%) against intensive care unit admission, and 96.5% (95% CI: 82.3–99.8%) against COVID-19 deaths. Among infected individuals, vaccine effectiveness was 79.2% (95% CI: 42.3–94.1%) in preventing severe or critical disease due to COVID-19. Vaccine effectiveness for ≥60 years was 72.3% (95% CI: 53.4–83.9%) in fully vaccinated individuals, higher than 64.8% (95% CI: 49.3–59.1%) for those <60 years. Two doses of BNT162b2 were highly effective against COVID-19 infection, severe or critical disease, intensive care unit admission and death due to COVID-19. This study addresses a gap in literature on BNT162b2 vaccine effectiveness in low- and middle-income populations and demonstrates the feasibility of such a study design in a resource limited setting while supporting evidence of waning immunity.