This study investigated whether Korean vowels, /?/ and /u/, are distinctively perceived after a labial consonant given the fact that native and Sino-Korean nouns showed only vowel /u/ after a labial consonant while this pattern was massively broken by the recent introduction of loanwords. For this purpose, a perception experiment was conducted with $V_1C_1V_2$ sequences in which different vowels /a, i, u/ and consonants /p, t, k/ occurred in $V_1$ and $C_1$ before the target $V_2$, /?/ and /u/. The data was produced by six speakers each from two different age groups, Age20 and Age40/50 in the read speech style. The results showed that consonant /p/ attracted significantly more responses of /u/ from /VC?/ sequences and significantly less responses of /u/ from /VCu/ sequence than the other consonants did in both age groups. Furthermore, Age20 group showed significantly less percentage of /u/ responses than Age40 group when the preceding consonant was /p/ regardless of the target vowel. We suggest therefore that unlike the traditional belief of labial assimilation, there is neutralization after a labial consonant in which vowels /?/ and /u/ are often realized as any sound between two vowels, /?/ and /u/. That is, this vowel change is not categorial but it rather produces an ambiguous stimulus which attracts different responses from different listeners. Ambiguous stimulus was produced due to coarticulatory efforts in speech production and perceptual compensation. We also argue that there is generational difference such that Age40/50 group speakers showed stronger tendency to produce /u/ after a labial consonant regardless of whether the target vowel was /?/ or /u/.