First, you'll escape all special characters in $first and $last, or use \Q...\E. (I can't believe noone else mentioned this.)

Secondly, if you match $first and $last, you need to reinsert them:

$string =~ s/(\Q$first\E).*?(\Q$last\E)/$1$reserve$2/;
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or use a zero-width assertion:

$string =~ s/(?<=\Q$first\E).*?(?=\Q$last\E)/$reserve/;
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Since you're constant strings, you could also use index instead of regexp:

$first_start = index($_, $first);
if ($first_start >= 0) {
   $first_end = $first_start + length($first);
   $last_start = index($_, $last, $first_end);
   if ($last_start >= 0) {
      substr($_, $first_end, $last_start, $replace);
   }
}
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