Emotion has an essential effect on various cognitive processes in humans including attention, perception, learning, and memory. Long-term memories are affected not only by the emotion experienced during learning but also by the emotional state during retrieval. The term “emotional memory” is often associated with episodic memory and mental time-travel; however, emotion influences every aspect of memory (e.g., both declarative memory and non-declarative memory). Here the authors discuss the methodological advantages and limitations across the current methods in emotional memory research. Traditional neuropsychological methods use emotionally arousing stimuli; however, such stimuli are often reduced to a simple list of words or pictures. In comparison to these methods, virtual reality (VR) is a relatively new tool, but with growing importance in neuroscience research and clinical practice. VR allows to study human behavior, cognitive functions, and brain activity in ecologically valid situations even under laboratory conditions. Future directions and potential use of virtual reality in emotional memory testing are discussed.