The emergence of the new Brazilian variant of concern, P.1 lineage (Gamma), raised concern about its impact on the epidemiological profile of COVID-19 cases due to its higher transmissibility rate and immune evasion ability. Using 272 whole-genome sequences combined with epidemiological data, we showed that P.1 introduction in São José do Rio Preto, São Paulo, Brazil, was followed by the displacement of eight circulating SARS-CoV-2 variants and a rapid increase in prevalence two months after its first detection. Our findings support that the P.1 variant is associated with an increase in mortality risk and severity of COVID-19 cases in younger aged groups, which corresponds to the unvaccinated population at the time. Moreover, our data highlight the beneficial effects of vaccination indicated by a pronounced reduction of severe cases and deaths in immunized individuals, reinforcing the need for rapid and massive vaccination.