Psycho-pathological conditions, such as depression or schizophrenia, are often accompanied by a distorted perception of time. People suffering from this conditions often report that the passage of time slows down considerably and that they are “stuck in time.” Virtual Reality (VR) could potentially help to diagnose and maybe treat such mental conditions. However, the conditions in which a VR simulation could correctly diagnose a time perception deviation are still unknown. In this paper, we present an experiment investigating the difference in time experience with and without a virtual body in VR, also known as avatar. The process of substituting a person’s body with a virtual body is called avatar embodiment. Numerous studies demonstrated interesting perceptual, emotional, behavioral, and psychological effects caused by avatar embodiment. However, the relations between time perception and avatar embodiment are still unclear. Whether or not the presence or absence of an avatar is already influencing time perception is still open to question. Therefore, we conducted a between-subjects design with and without avatar embodiment as well as a real condition (avatar vs. no-avatar vs. real). A group of 105 healthy subjects had to wait for seven and a half minutes in a room without any distractors (e.g., no window, magazine, people, decoration) or time indicators (e.g., clocks, sunlight). The virtual environment replicates the real physical environment. Participants were unaware that they will be asked to estimate their waiting time duration as well as describing their experience of the passage of time at a later stage. Our main finding shows that the presence of an avatar is leading to a significantly faster perceived passage of time. It seems to be promising to integrate avatar embodiment in future VR time-based therapy applications as they potentially could modulate a user’s perception of the passage of time. We also found no significant difference in time perception between the real and the VR conditions (avatar, no-avatar), but further research is needed to better understand this outcome.