Enlarge Image James Martin/CNET

It's about to go from virtual to very, very real.

The video game industry is embracing virtual reality like never before. Major game makers from Sony to Microsoft and Ubisoft are preparing new products based on the emerging technology even as tech giants including Facebook, Google, Samsung and HTC have plunged into the virtual waters.

Now the industry's Electronic Entertainment Expo, or E3 -- the highest-profile video game conference of the year -- will launch the technology into people's living rooms.

As many as 27 exhibitors will showcase virtual-reality products, up from six last year, according to the expo's organizer, the Entertainment Software Association. What's more, the conference is sold out (it has not always been so), and it attracted 50 more exhibitors than it did last year.

"It's been a really fabulous shot in the arm," said Mike Gallagher, head of the ESA, speaking of virtual reality's impact on the market. "We're months away from being in the marketplace and in consumers' hands."

But virtual reality could do more than give an economic boost to video game makers. It could also deliver another leg of growth to the broader tech industry. Facebook CEO Mark Zuckerberg says VR could eventually become our primary mode of interacting with computers. Movie makers, television producers and musicians say it could transform how we experience entertainment.

"It's this huge new medium that people have only started to imagine where you could go with it," said Rob Coneybeer, managing director of Shasta Ventures, which led a $4 million investment last year in VR company Survios.

One thing that drew him to the technology is its potential to place players smack in the middle of a 3D world, as action literally swirls around them. "People's excitement is well founded."

March of the game makers

Without question, Oculus --the virtual-reality company Facebook bought for $2 billion last year -- will be one of the most prominent game makers on the show floor. The company made consumers care about VR after unveiling its first prototypes three years ago.

Since then, it's been a virtual march of VR game makers, as companies including Samsung and Google have either revealed upcoming products or talked about their research efforts.

Microsoft, maker of the Xbox video game console and the Windows software that powers most of the world's PCs, on Thursday announced a partnership with Oculus to play Xbox games on the headset. "Oculus had such a head start," said Phil Spencer, head of Microsoft's Xbox group. "It's good for Windows, and it's good for Xbox."

More game makers will likely join in.

Sony said it will launch its VR headset, called Project Morpheus, next year. Designed for the PlayStation, the device will work with accessories such as the wandlike motion controllers Sony released in 2010. Sony is expected to announce new games at the expo and to offer details about games that will be available when the headset launches.

Oculus and Microsoft will be at the show as well, demonstrating their respective efforts. HTC and Valve, however, said they won't be showing off their Vive headset .

Ubisoft, maker of the popular Assassin's Creed franchise of adventure games, has said it's working on virtual-reality titles, but hasn't provided any more details. Other top game makers like Electronic Arts are researching the technology, though they haven't made public commitments.

Still, it's unclear if customers will buy these products. The game industry failed to sell VR to consumers two decades ago, and has had a mixed success introducing technology to the mainstream.

"People have only started to imagine where you could go with it." Rob Coneybeer, managing director of Shasta Ventures

On the plus side, Microsoft's Xbox 360 and Sony's PlayStation 3 helped to popularize high-definition televisions, and Nintendo's Wii introduced consumers to controllers that sense motion, allowing them to make a swing in the real world and watch a tennis player strike the ball on screen.

But the industry couldn't convince consumers to buy 3D televisions, despite a massive push from both the gaming and TV industries.

And not all video game makers have voiced support for VR, prompting some of the most successful developers and titles to stay clear of the devices for now. And many question the long-term effect the technology (known for causing nausea) could have on our brains and bodies, a concern that's been raised by the US Army.

Still, Gallagher says E3 will be a hotbed of attention-getting VR products and demos.

"The buildup wasn't as large" as with 3D, he said. "This seems quite different."