This study aimed to evaluate the effectiveness of Immersive Virtual Reality Exposure Therapy (IVRET) in treating social phobia among Master of Business Administration (MBA) students. A randomized controlled trial was conducted with 25 MBA students, aged 21–22, exhibiting elevated stress and anxiety levels. Participants were assigned to either IVRET or traditional Cognitive Behavioral Therapy (CBT) for a period of 4 months. Pre- and post-intervention assessments measured changes in social anxiety, self-efficacy, and quality of life. Auditory and visual reaction times, as well as self-reported stress and anxiety levels, were analyzed using non-parametric tests with a significance level of p < 0.05. Results indicated significant reductions in social anxiety, particularly in public speaking fears, among students who received IVRET. Improvements in reaction times and decreased stress levels further supported these findings. IVRET was found to be as effective as traditional CBT in reducing social anxiety, suggesting its potential as an early intervention tool in academic settings. Further studies are recommended to confirm these findings and assess the long-term effectiveness of IVRET in this population.