The nature of videogame worlds and their interactive potential has drawn considerable interest from philosophers and game theorists, who have proposed what are sometimes competing theoretical approaches and conceptualizations. This chapter focuses on the appropriate conceptual relationship between virtuality and fiction. It shows how the concepts combine in the technological development of virtual reality (VR) media; moreover, without the potentially distracting involvement of metaphysical issues that has left the literature about virtual reality in such a muddle. The chapter argues that virtual realism is an unhelpful and frequently muddled position that conflates issues that are best kept distinct. It suggests that the use of the concept of virtual worlds ranges widely over some very different phenomena, from the worlds of video-games, instances of VR, virtual stores and currency, to fantasies about perfect Matrix-like virtual realities. Modern off-the-shelf videogame VR typically has two key features that fit easily into the analysis of fictive interactivity: virtual situation and virtual interaction.