GaAs-based oxide-confined vertical-cavity surface-emitting lasers (VCSELs) exhibit relatively low resistance against reliability-related damage. In order to gain a deeper understanding of the degradation and failure mechanism in oxide-confined VCSELs caused by electrostatic discharge (ESD)-induced defect proliferation, we investigated the effects of ESD stress on the degradation of optical-electrical characteristics and the evolution of defects in VCSELs under human body model test condition. The degradation threshold values for forward and reverse ESD pulse amplitudes were estimated to be 200 V and -50 V, respectively. Notably, VCSELs demonstrated greater sensitivity to reverse bias ESD compared to forward bias ESD. Analysis of optical emission and microstructure provided evidence that the device failure is attributed to an increase in ESD current density, leading to the multiplication of dark line defects (DLDs) originating from the edge of the device's oxide aperture. The formation of defects occurred suddenly in discrete events within small regions, rather than progressing gradually and uniformly. These defects propagated and led to damage across the entire active region. We believe that our results would be meaningful for improving the reliability of VCSEL in the future.