An illumination system designed to eliminate laser speckle and a single-panel projection system employing the same. The illumination system includes a laser light source to sequentially emit a plurality of laser beams, and a first diffractive optical element that is partitioned into a plurality of segments having diffractive patterns that correspond to the plurality of laser beams to move synchronously with the sequential emission of the plurality of laser beams. The laser speckle is removed by moving the first diffractive optical element in such a manner as to temporally average the plurality of laser beams. The illumination system efficiently removes the laser speckle, and the projection system having the illumination system provides improved image quality.