Virtual reality (VR) technology provides a human-computer interface that allows participants to interact naturally with digital objects which are represented as three-dimensional images that occupy positions in a three-dimensional world. Related to problems of engineering design and manufacturing, this new technology offers engineers the ability to work with computer models in a three-dimensional, immersive environment. This paper describes a virtual reality application where the results of a discrete event simulation of a manufacturing cell are integrated with a virtual model of the cell to produce a virtual environment. The program described in this paper, the VRFactory, combines results from a commercial discrete event simulation program, SLAM II, with a virtual environment. This allows the user to investigate, using three-dimensional computer models, how various changes to the manufacturing cell affect part production. This investigation is performed while immersed in a computer-generated three-dimensional representation of the cell. Existing discrete event programming software allows only two-dimensional views of the factory as the parts progress through the simulation. Parts are shown only as primitive geometric shapes on the computer monitor and instantaneously move from one station to the next. The virtual environment implementation of the SLAM II results allows users to experience the simulation in a fully immersive three-dimensional digital environment. The virtual environment used here is a CAVE™-like projection screen-based facility called the C2, which is located at Iowa State University. This paper describes the creation of the VR model of the manufacturing cell, the animation of the environment and the implementation of the results of the discrete event simulation.