This paper reviews the area of combined discrete event simulation (DES) and virtual reality (VR) use within industry. While establishing a state of the art for progress in this area, this paper makes the case for VR DES as the vehicle of choice for complex data analysis through interactive simulation models, highlighting both its advantages and current limitations. This paper reviews active research topics such as VR and DES real-time integration, communication protocols, system design considerations, model validation, and applications of VR and DES. While summarizing future research directions for this technology combination, the case is made for smart factory adoption of VR DES as a new platform for scenario testing and decision making. It is put that in order for VR DES to fully meet the visualization requirements of both Industry 4.0 and Industrial Internet visions of digital manufacturing, further research is required in the areas of lower latency image processing, DES delivery as a service, gesture recognition for VR DES interaction, and linkage of DES to real-time data streams and Big Data sets.