A computer implemented method and a virtual and physical environment integration system (VPEIS) for dynamically integrating a virtual environment with a physical environment are provided. The VPEIS receives dimensions and an orientation of the physical environment, and a user device's reference position in the physical environment. The VPEIS dynamically integrates the virtual environment with the physical environment on the user device by orienting the virtual environment relative to the orientation of the physical environment and the user device's reference position, dynamically updating a position, a movement including a user's step, and a direction of movement of the user device in the oriented virtual environment using sensors internal to the user device, and dynamically tracking a position, a movement, and a direction of movement of virtual objects and the user device, interactions between the virtual objects, and interactions of the virtual objects with the user device in the oriented virtual environment.