Exposure therapy for specific phobia involving systematic and repeated presentation of an aversive stimuli or situation is a highly effective treatment for reducing fear and anxiety. Dissemination of this evidence-based treatment has proved challenging, however, and for over 20 years an alternative method of delivery using virtual reality technology has been explored with positive results. This thesis consists of three empirical studies examining a new generation of virtual reality exposure therapy (VRET) that by using automation, inexpensive hardware, and downloadable software aims to ensure that a highly efficacious exposure therapy can be made available to almost anyone. Study I evaluated the efficacy of this novel automated VRET for spider phobia as compared to gold-standard in-vivo one-session treatment (OST) using a randomized non-inferiority design. Results indicated that large effect size reductions in self-reported fear were evident at post-assessment in both treatments and the automated VRET was not inferior to OST at 3- and 12-months follow-up according to behavioral approach test, but was significantly worse until 12-month follow-up. No significant difference was noted on a questionnaire measuring negative effects of treatment. Study II conducted a process measure evaluation of patient alliance towards the virtual therapist used in the VRET treatment with a purpose-built questionnaire entitled the Virtual Therapist Alliance Scale (VTAS). Exploratory factor analysis indicated a sound two-factor solution composed of a primary task, goal and co-presence factor and a secondary bond and empathy factor. Psychometric evaluation of the VTAS suggested good internal consistency, and a moderate correlation between the VTAS and change in self-reported fear over follow-up. Study III assessed what individuals with a fear of spiders found most frightening about spiders. Both quantitative ratings and qualitative descriptions indicated that movement characteristics were reported as most fear provoking and to a lesser extent appearance characteristics, however factor analysis of scores in these categories did not find a correlation with participant baseline self-reported fear. Overall, the above findings suggest that VRET is a potential alternative to OST for the treatment of spider phobia also with respect to therapist alliance, and spider movement characteristics should be emphasized in future VRET treatments.