Today, virtual reality (VR) technologies are available to more consumers and companies because of low costs and development of Head Mounted Displays, HMD. HMDs need less room space in comparison to other virtual systems. Because of the availability of these devices, new tools used for sketching and modelling are being developed. In this thesis, we study the application of tools used for sketching and modelling in product development. VR technologies are mostly used for detailed ergonomic analyses and review of complex CAD models. However, they are starting to be used for creating CAD models. We have included five VR tools which can be used for sketching and modelling and they are Autodesk Alias, Google Blocks, Microsoft Maquette, Flying Shapes and Gravity Sketch. In every one of these tools, we replicated three CAD models which will be compared to traditional CAD modelling. First model is a headset as an industry product, second model is a flange as a mechanical product and third model is an assembly. Analysis of the modelling procedures of the three models is made between every VR tool and in relationship to traditional CAD modelling. Also, we analyzed final models made with VR tools. In the end of this thesis, we will propose recommendations for using VR tools in product design.