Paying attention to business ethics and educating ethical leaders and employees can impact organizational performance. Effective professional ethics education and learning can prevent administrative corruption, embezzlement and fraud in organizations. On the other hand, the development of digital technologies has created transformations in educational processes and methods. Evaluating the effectiveness of innovative teaching methods will greatly help the learning process of individuals and educational planning of business schools. Flipped learning is an educational approach in which students learn about course content before class. Accordingly, the aim of this research is to evaluate the impact of virtual reality (VR)-based flipped learning compared to the traditional method of teaching business ethics. This study was applied and quasi-experimental. Among business students of Shiraz University, 135 people were randomly divided into three groups. The first experimental group underwent training with the flipped learning method based on VR and the second experimental group underwent training with the traditional method and the third group was the control group. The control group didn't receive training and was selected only for the purpose of comparison with experimental groups. Pretest and posttest designs were used and the results of the three groups were compared using the Tukey test. The results showed that the two groups that received business ethics education had a significant difference compared to the control group. An important finding of this study revealed that among the two teaching methods, VR-based flipped learning had a greater impact on students' business ethics compared to the traditional teacher-centered approach. Accordingly, university managers and business ethics course instructors can facilitate the learning process using VR-based flipped learning. Designing simulation software for ethical scenarios is also a suitable solution for teaching business ethics.