Virtual reality (VR) applications are becoming increasingly popular and are being used in various applications. VR applications can be used to simulate large real-world landscapes in a computer program for various purposes such as entertainment, education or business. Typically, 3-dimensional (3D) and VR applications use environments that are made up of meshes of relatively small size. As the size of the meshes increase, the applications start experiencing lagging and run-time memory errors. Therefore, it is inefficient to upload large-sized meshes into a VR application directly. Manually modelling an accurate real-world environment can also be a complicated task, due to the large size and complex nature of the landscapes. In this research, a method to automatically convert 3D point-clouds of any size and complexity into a format that can be efficiently rendered in a VR application is proposed. Apart from reducing the cost on performance, the solution also reduces the risks of virtual reality induced motion sickness. The pipeline of the system incorporates three main steps: a surface reconstruction step, a texturing step and a segmentation step. The surface reconstruction step is necessary to convert the 3D point-clouds into 3D triangulated meshes. Texturing is required to add a realistic feel to the appearance of themeshes. Segmentation is used to split large-sized meshes into smaller components that can be rendered individually without overflowing the memory. A novel mesh segmentation algorithm, the Triangle Pool Algorithm (TPA) is designed to segment the mesh into smaller parts. To avoid using the complex geometric and surface features of natural scenes, the TPA algorithm uses the colour attribute of the natural scenes for segmentation. The TPA algorithm manages to produce comparable results to those of state-of-the-art 3D segmentation algorithms when segmenting regular 3D objects and also manages to outperform the state-of-the-art algorithms when segmenting meshes of real-world natural landscapes. The VR application is designed using the Unreal and Unity 3D engines. Its principle of operation involves rendering regions closer to the user using highly-detailed multiple mesh segments, whilst regions further away from the user are comprised of a lower detailed mesh. The rest of the segments that are not rendered at a particular time, are stored in external storage. The principle of operation manages to free up memory and also to reduce the amount of computational power required to render highly-detailed meshes. / Dissertation (MEng)--University of Pretoria, 2020. / Electrical, Electronic and Computer Engineering / MEng / Unrestricted