During the interwar years Warkwicze's 880 Jews comprised 85 percent of the town's total population. Most Jews were engaged in crafts or petty trade, mainly in agricultural produce. The town had a private Jewish school that taught Hebrew, among other subjects. There was also a Beit midrash, a Talmud Torah, and a Jewish public library. Zionist parties and their youth organizations (such as Beitar and Hanoar Hazioni) were active in Warkowicze. After September 17, 1939, with the arrival of the Red Army following the Ribbentrop-Molotov Pact, Warkowicze became part of Soviet Ukraine. Under Soviet rule private businesses were closed down and most local Jews shifted to work in cooperatives. At this time a Jewish kolkhoz was established near the town. It is estimated that on the eve of the German invasion of the Soviet Union in June 1941, there were more than 1,200 Jews living in Warkowicze, including refugees that had arrived from central and western parts of Nazi-occupied Poland in 1939.
The Germans occupied the town on June 27, 1941. By this time about 5 percent of the town's Jews had left for the safer, eastern part of the country. On July 8 German security forces conducted a murder operation against members of the Jewish intelligentsia, mainly doctors, in which they shot at least three men and two women. Most probably in the same month, a Judenrat (Jewish council) was established and all gold and silver items had to be handed over to the Germans to be sent to Berlin. In the summer and fall of 1941 the German civil administration introduced a number of anti-Jewish measures in Warkowicze. Jews were required to wear distinguishing armbands bearing the Star of David (replaced later by yellow patches) on their chests and backs. They were forbidden to leave the town or to trade with non-Jews and were required to perform forced labor, such as building an airfield near Równe, constructing roads under the supervision of German engineers from the Todt Organization, and harvesting grain.
In May 1942 the Germans restricted the Jews to a specific part of the town, which became a ghetto. In August the ghetto was enclosed by a fence reinforced with barbed wire. However, several artisans and their families were allowed to live outside. Since it was not difficult to leave the ghetto its inhabitants managed to obtain food from the local population. In late September or early October (or, according to another source, in May) 1942, Jews from the nearby farming village of Ozierany were taken to the Warkowicze ghetto, which by then had been closed.
The ghetto was apparently liquidated on October 7, 1942, when its 2,500 inmates were shot to death outside the town by a German unit. Most of the Jews who were able to escape on the eve of the murder operation were recaptured with the aid of Ukrainian auxiliary police and other local inhabitants, and subsequently shot to death.
Warkowicze was liberated by the Red Army in February 1944.