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Abstract Background In recent years, the use of virtual reality (VR) as a complementary intervention in treating cognitive impairment has significantly increased. VR applications based on instrumental activities of daily living (iADL-VR) could offer a promising approach with greater ecological validity for intervention in groups with cognitive impairments. However, the effectiveness of this approach is still debated. Objective This systematic review aims to synthesize the effects of iADL-VR interventions to rehabilitate, train, or stimulate cognitive functions in healthy adults and people with mild cognitive impairment (MCI) and different types of dementia. Methods A systematic search was performed in the Scopus, PubMed, IEEE Xplore, Web of Science, and APA PsycNet databases until September 2022 and repeated in April 2023. The selected studies met the search terms, were peer-reviewed, included an iADL-VR intervention, and were written in English. Descriptive, qualitative studies, reviews, cognitive assessment, non-intervention studies, those unrelated to VR or iADL, those focused on motor aspects, and non-degenerative disorders were excluded. The PEDro scale was used to assess the methodological quality of the controlled studies. To present and synthesize the results, we organized the extracted data into three tables, including PEDro scores, participant characteristics, and study characteristics. Results Nineteen studies that met the inclusion and exclusion criteria were included. The total sample reached 590 participants, mostly women (72.67%). Approximately 30% were diagnosed with Alzheimer’s disease or dementia, and 20% had mild cognitive impairment. Variables such as authors and year of publication, study design, type of intervention and VR applied, duration of the intervention, main findings, and conclusions were extracted. Regarding demographic characteristics, the sample size, age, sex, years of education, neurological diagnosis, dropouts, and the city and country where the intervention took place were recorded. Almost all studies showed improvements in some or all the outcomes after the intervention, generally greater in the iADL-VR group than in the control group. Conclusion iADL-VR interventions could be beneficial in improving the performance of cognitive functions in older adults and people with MCI and different types of dementia. The ecological component of these tasks makes them very suitable for transferring what has been learned to the real world. However, such transfer needs to be confirmed by further studies with larger and more homogeneous samples and longer follow-up periods. This review had no primary funding source and was registered with PROSPERO under registration ID: 375166.