High-fidelity patient simulation (HFPS) is widely used in professional training to enhance students’ competence in clinical management. Problem-solving (PS) and clinical reasoning (CR) skills are essential to developing students in professional competence in safe and effective care. These two skills should be initiated at the early training. However, little is known about the effects of HFPS on developing PS and CR skills in first year undergraduate students. Therefore, this pre- and post-experimental study aimed to investigate the effects of HFPS on development of PS and CR skills in first-year nursing students. The students were required to go through four sessions, preparation, pre-briefing and orientation, simulation role-playing, and debriefing, for the HFPS. The study utilized the Problem-Solving Inventory (PSI) and the Nurses Clinical Reasoning Scale (NCRS) to measure problem-solving and clinical reasoning abilities before and after HFPS. Bivariate analysis, one-sample t-test, and independent t-test were performed to evaluate the performance of the PS and CR skills at the two study periods. One hundred eighty-nine students were recruited, with a mean age of 20.56 years, and 73% were female students. The analytic results showed that the PSI, particularly in domains of Problem-Solving Confidence (PSC) (p<0.001) and overall PS (p<0.001), and the CR (p<0.001) had significant improvement after HFPS. The study concluded that HFPS is an effective innovative method to significantly improve students’ problem-solving and clinical reasoning abilities. Nurse educators play an important role in providing explicit learning instructions in a simulation guideline that directs and guides students to learn at each stage of HFPS. Students should take more initiative and engage in their learning through HFPS to enhance their competence in knowledge and higher intellectual skills for personal and professional developments.