While there may be some overlap in the two technologies, AR and VR are primarily two distinct concepts.
To augment something is to make it larger in size or value. So we can think of Augmented Reality as an enhanced reality. This can be applied to the current range of AR glasses being developed, such as Google’s ‘Glass’ and BMW’s ‘MINI Augmented Vision’. Such glasses allow for the real world to be viewed but at the same time overlay further information to benefit the user. This information could be anything from a reminder of the current speed zone you are in, to the name of a business contact that you recognise but can’t recall the name of.
AR has the potential to benefit a very wide range of daily interactions and workplace requirements.
In contrast to AR, Virtual Reality intends to hide the real world and replace it with a simulated view of reality. This simulated experience could be anything the imagination can dream up. Oculus Rift is a prime example of a Virtual Reality system. VR can also be described as an immersive experience, and the sensation of reality (although fake) can be increased by using a range of your senses. By providing 3D vision, 3D sound and perhaps tactile feedback, reality can be suspended and the viewer can be transported into a world of pure fantasy.
The main uses for VR therefore will be experiential. These are either for entertainment purposes such as computer games and cinema, or for real life simulation purposes for training.
NASA's Virtual Reality Laboratory (VRL) simulation training in 2007
By nature, Augmented Reality is more inclusive and allows for a richer world experience, where Virtual Reality is more isolating, allowing for a rich individual experience. The technology used in the two concepts may well overlap; geospatial sensors can be used in both AR and VR to detect the direction the wearer is facing; gesture movements for data input; and audio and tactile functions could also be used in both concepts.