The recent advances in Deep Convolutional Neural Networks (DCNNs) have shown extremely good results for video human action classification, however, action detection is still a challenging problem. The current action detection approaches follow a complex pipeline which involves multiple tasks such as tube proposals, optical flow, and tube classification. In this work, we present a more elegant solution for action detection based on the recently developed capsule network. We propose a 3D capsule network for videos, called VideoCapsuleNet: a unified network for action detection which can jointly perform pixel-wise action segmentation along with action classification. The proposed network is a generalization of capsule network from 2D to 3D, which takes a sequence of video frames as input. The 3D generalization drastically increases the number of capsules in the network, making capsule routing computationally expensive. We introduce capsule-pooling in the convolutional capsule layer to address this issue and make the voting algorithm tractable. The routing-by-agreement in the network inherently models the action representations and various action characteristics are captured by the predicted capsules. This inspired us to utilize the capsules for action localization and the class-specific capsules predicted by the network are used to determine a pixel-wise localization of actions. The localization is further improved by parameterized skip connections with the convolutional capsule layers and the network is trained end-to-end with a classification as well as localization loss. The proposed network achieves state-of-the-art performance on multiple action detection datasets including UCF-Sports, J-HMDB, and UCF-101 (24 classes) with an impressive ~20% improvement on UCF-101 and ~15% improvement on J-HMDB in terms of v-mAP scores.