The Venice Film Festival has had an immersive section since 2017. Sundance has shown VR work for nearly a decade. But for most of that time, “VR film” meant one of two things: a 360-degree video where you sat in a chair and looked around, or an interactive experience that was more game than film.

That’s changing. The VR films coming out of festivals in 2025 and early 2026 are genuinely different—they’re figuring out how to tell stories in a medium where the audience is inside the story, and the best ones are doing it well.

What Changed

The hardware matured. Five years ago, showing VR film at a festival meant setting up tethered headsets with dedicated PCs, managing cables, and hoping the tracking didn’t drift during a 20-minute piece. Today, a Quest 3 or Pico 4 runs standalone, the setup takes minutes, and the visual quality is high enough that you’re not distracted by pixels.

But the bigger shift is creative. Early VR filmmakers were technologists who happened to make films, or traditional filmmakers experimenting with new toys. The current generation grew up with VR as a known medium. They understand what works and what doesn’t, and they’ve stopped trying to replicate flat cinema in 360 degrees.

The Venice Immersive programme selected 30 projects in its latest edition, ranging from six-minute pieces to hour-long experiences. The breadth of approaches is striking—animated, live-action, interactive, passive, solo, and multiplayer works all competing in the same section.

What Good VR Cinema Looks Like

The best VR films I’ve seen recently share a few characteristics.

They use presence, not spectacle. The unique thing about VR isn’t that things can fly at your face. It’s that you feel like you’re somewhere. The strongest pieces put you in an intimate space—a small room, a garden, beside another person—and let the presence do the emotional work. A conversation feels different when the person is life-size and two metres away from you.

They guide attention without forcing it. This is the hardest problem in VR filmmaking. In flat cinema, the director controls the frame. In VR, the viewer can look anywhere. Bad VR films either ignore this (and you miss important things happening behind you) or overcompensate with heavy-handed cues that feel manipulative.

The good ones use spatial audio, subtle lighting, movement in peripheral vision, and character blocking to draw your attention naturally. It feels like you’re choosing where to look, but the director has made sure the interesting thing is where you’ll probably look anyway.

They embrace non-linear structure. Some of the most interesting work accepts that different viewers will have different experiences. A scene plays out around you, and what you focus on shapes your understanding. You might watch the piece twice and notice completely different details, like walking through a real space rather than watching a recording of one.

Australian VR Filmmaking

Australia has a small but active immersive filmmaking community. The Australian Centre for the Moving Image (ACMI) in Melbourne has hosted VR exhibitions regularly, and several Australian VR works have screened at Venice and Tribeca.

The challenge for Australian creators is funding. Screen Australia has supported immersive projects through its online production fund, but the amounts are small compared to traditional film funding, and the distribution path for VR films is still unclear. You can’t put a VR film in cinemas without specialised venues, and the home audience—people who own headsets and seek out narrative VR content—remains niche.

That said, the quality of work coming from Australian studios like Sandpit, S1T2, and individual artists is high. The constraint of smaller budgets often pushes creators toward more intimate, character-driven pieces rather than the spectacle-heavy approach that big studios default to. That’s arguably a better fit for the medium.

The Distribution Problem

This is the elephant in the room. You can make a brilliant VR film, but how do people see it?

Festival screenings work but reach small audiences. The Meta Quest store carries some narrative VR content, but it’s overwhelmed by games and fitness apps. Apple’s Vision Pro has a growing library of immersive video, but the installed base is tiny. YouTube VR exists but the discovery is terrible and the quality ceiling is low.

The most promising model might be location-based venues—purpose-built spaces where you go to watch VR cinema, like a traditional cinema but with headsets. A few of these exist in Paris, Amsterdam, and New York. They solve the hardware ownership problem and create a social context around viewing. But they’re expensive to operate and limited in reach.

For now, most VR filmmakers accept that their audience is small and focus on the work itself, trusting that the medium will find its distribution model eventually. That’s a frustrating position but probably the right one.

Where It Goes From Here

Mixed reality opens new possibilities. Instead of fully virtual environments, filmmakers can overlay narrative elements onto real spaces. Imagine watching a historical drama that plays out in the actual location where events happened, with virtual characters appearing in the real building around you.

Multiplayer VR cinema is another frontier. Watching a VR film alone is one experience. Watching it with three other people who are present in the space with you—where you can see their reactions and share the moment—adds a social dimension that flat cinema has always had but VR mostly hasn’t.

The medium isn’t going to replace traditional film. It doesn’t need to. What it offers is something different: presence, embodiment, a sense of being somewhere rather than watching somewhere. The filmmakers who understand that distinction are making work worth seeking out.