One significant technological advancement that can improve the realism and intelligence of virtual worlds is image processing. Users can have more immersive and interesting experiences thanks to image processing. Virtual and augmented reality have the potential to revolutionize the interface between the digital and physical worlds. The necessity for effective image depth information processing is highlighted by the growing demand for apps utilising virtual and augmented reality. The fields of augmented reality and virtual reality (AR/VR) have enormous potential to transform interactions in areas where as remote collaboration, virtual training simulators and immersive education etc., communicate, and work together. Specifically, the recently developed mobile applications for augmented reality and virtual reality are expected to be among the most demanding ones that have been run on wireless networks to far. For immersive user experiences, augmented and virtual reality technologies primarily rely on video streaming and playback. The goal of augmented reality (AR) is to alter how real-world visuals are perceived by superimposing digital data on top of them. Real-time information augmentation of the real world is possible. The main objective of AR is to embrace the outdoors and develop a creative and effective paradigm for every application. We address augmented reality, virtual reality, and several methods of virtual reality and augmented reality for image processing in this research. The objective of this review is to offer a comprehensive grasp of feature detection and matching, object recognition and segmentation, 3D reconstruction, image registration and tracking. This paper discusses technical issues and makes recommendations for additional study to improve image processing in virtual reality and augmented reality.