An automated pill dispensing system includes an output chute configured to hold pill-containing vials and an optical sensor located at a predetermined location in the output chute. The optical sensor includes an optical emitter and an optical detector configured to be operated cooperatively to output a detection signal indicating a presence or absence of a vial at the predetermined location of the output chute. A controller is coupled to the optical sensor and is configured to receive the detection signal therefrom, detect the presence or absence of the vial at the predetermined location of the output chute in response to the detection signal, and control a next depositing event whereby a next vial is deposited in the output chute responsive to the detection. Related methods of operation are also discussed.