Methods for disambiguation and tracking of two or more wireless hand-held controllers with passive optical and inertial tracking within a system having a head mounted virtual or augmented reality display device having a forward facing optical sensor having a field of view, and wherein the display device interfaces with wireless hand-held inertial controllers for providing user input to the display device, with each controller two passive optically reflective markers, one marker being position at or adjacent each end of the controller and being separated by a known distance, and each controller also including an onboard inertial measurement unit for providing inertial data corresponding to its orientation.