There is provided a system and method for latency compensation in a 360° VR video editing system. One embodiment involves a determination of the latency delay between the computer that stores and edits the video and a VR headset worn by the user. This delay might be caused by the need to read, prepare, and wirelessly transmit each video frame to the headset. The determined latency delay is used within the computer to adjust the timeline location of editing commands issued by the user so that they match the timeline locations seen by the user within the headset. This is done so that the user's edit commands are applied within the computer at the same video frame the user was viewing within the VR headset when the command was issued. In some embodiments the display device of the VR headset might be a smart phone.