Laser-induced damage is studied in the rat corneal epithelium and stroma using a combination of time-resolved imaging and biological assays. Cavitation bubble interactions with cells are visualized at a higher spatial resolution than previously reported. The shock wave is observed to propagate through the epithelium without cell displacement or deformation. Cavitation bubble expansion is damped in tissue with a reduction in maximum size in the range of 54 to 59%, as compared to 2-D and 3-D cultures. Bubble expansion on nanosecond timescales results in rupture of the epithelial sheet and severe compression of cell layers beyond the bubble rim. In the stroma, the dense collagen lamellae strongly damped bubble expansion, thus resulting in reduced damage. The acute biological response of this tissue to laser pulses is characterized by confocal fluorescence microscopy. A viability assay of the epithelium reveals that only cells around the immediate site of laser focus are killed, while cells seen to undergo large deformations remain alive. Actin morphology in cells facing this mechanical stress is unchanged. Collagen microstructure in the stroma as revealed by second-harmonic imaging around the ablation site shows minimal disruption. These cellular responses are also compared to in vitro 2-D and 3-D cell cultures.