Molecular wave-packet dynamics in oxygen are studied in the time domain, using a single-color VUV-pump-VUV-probe scheme. 17-fs VUV pulses, centered at 161 nm are generated via high-order harmonic generation driven by an intense 800-nm pulse leading to VUV pulse energies that reach 1.1μJ per pulse. An all-reflective interferometric pump-probe scheme is used for studying the delay dependence of the molecular oxygen ion signal with simultaneous nonresonant photoionization of krypton as a precise timing-reference. Access to the excited dissociative state lifetime is provided by the resulting delay-dependent O2+ signal, ultimately limited by the molecular ionization window. The ability to use a two-photon VUV probe provides the delay-dependent detection of O+ as an additional observable, extending the dissociation observation window.