The Florida Marlins drafted Vargas out of Long Beach State with their second-round pick in the 2004 MLB draft, and he was signed by scout Robby Cosaro; he was a collegiate teammate of Jered Weaver, who was the Anaheim Angels' first-round pick in 2004. Vargas was the 68th player taken overall in the draft. He signed with the Marlins in time to make eight starts in 2004 with their Low A affiliate, the Jamestown Jammers, with whom he went 3–1 with an ERA of 1.96 in eight starts, and was named the #3 prospect in the New York=Penn League by "Baseball America". He was the Marlins Organizational Pitcher of the Month for August. He finished 2004 with three starts at the end of the 2004 campaign with one of the Marlins' Single-A affiliates, the Greensboro Grasshoppers of the South Atlantic League. He had a record of 2–1, an ERA of 2.37, and struck out 17 batters in 19 innings pitched.