Virtual Reality (VR) techniques are increasingly being used for education about and in the treatment of certain types of mental illness. Research indicates that VR is delivering on its promised potential to provide enhanced training and treatment outcomes through incorporation of this high-end technology. Schizophrenia is a mental disorder affecting 1–2% of the population, and it is estimated 12–16% of hospital beds in Australia are occupied by patients with psychosis. Tragically, there is also an increased risk of suicide associated with this diagnosis. A significant research project being undertaken across the University of Queensland faculties of Health Sciences and EPSA (Engineering, Physical Sciences and Architecture) has constructed a number of virtual environments that reproduce the phenomena experienced by patients who have psychosis. Symptoms of psychosis include delusions, hallucinations and thought disorder. The VR environment will allow behavioral, exposure therapies to be conducted with exactly controlled exposure stimuli and an expected reduction in risk of harm. This paper reports on the current work of the project, previous stages of software development and the final goal to introduce VR to medical consulting rooms.