Virtual reality and interactive video gaming have emerged as new treatment approaches in stroke rehabilitation settings over the last ten years. The primary objective of this review was to determine the effectiveness of virtual reality on upper limb function and activity after stroke. The impact on secondary outcomes including gait, cognitive function and activities of daily living was also assessed. Randomized and quasi-randomized controlled trials comparing virtual reality with an alternative intervention or no intervention were eligible to be included in the review. The authors searched a number of electronic databases including: the Cochrane Stroke Group Trials Register, the Cochrane Central Register of Controlled Trials, MEDLINE, EMBASE, AMED, CINAHL, PsycINFO, clinical trial registers, reference lists, Dissertation Abstracts and contacted key researchers in the field. Search results were independently examined by two review authors to identify studies meeting the inclusion criteria. A total of 37 randomized or quasi randomized controlled trials with a total of 1019 participants were included in the review. Virtual reality was found to be significantly more effective than conventional therapy in improving upper limb function (standardized mean difference [SMD] 0.28, 95% confidence intervals [CI] 0.08 to 0.49) based on 12 studies and significantly more effective than no therapy in improving upper limber function (SMD 0.44 [95% CI 0.15 to 0.73]) based on nine studies. The use of virtual reality also significantly improved activities of daily living function when compared to more conventional therapy approaches (SMD 0.43 [95% CI 0.18 to 0.69]) based on eight studies. While there are a large number of studies assessing the efficacy of virtual reality they tend to be small and many are at risk of bias. While there is evidence to support the use of virtual reality intervention as part of upper limb training programs, more research is required to determine whether it is beneficial in terms of improving lower limb function and gait and cognitive function.