Data are presented on the 300-K continuous and pulsed photopumped laser operation of AlyGa1-yAs-GaAs-InxGa1-xAs quantum-well heterostructure (QWH) crystals that utilize large-index-step high-contrast distributed Bragg reflector mirrors. The mirrors are formed by selective lateral oxidation (H2O+N2, 425-degrees-C) of three lower and three upper AlAs layers in the structure, resulting in enhanced cavity Q in the vertical direction. The laterally oxidized mirrors, a small lower and an upper ''stack'' that sandwich a lateral waveguide and double QW active region, are of sufficient quality to permit vertical-cavity laser operation of the QWH crystals.