A high-fidelity but efficient sound simulation is an essential element of any VR experience. Many of the techniques used in virtual acoustics are graphical rendering techniques suitably modified to account for sound generation and propagation. In recent years, several advances in hardware and software technologies have been facilitating the development of immersive interactive sound-rendering experiences. In this article, we present a review of the state of the art of such simulations, with a focus on the different elements that, combined, provide a complete interactive sonic experience. This includes physics-based simulation of sound effects and their propagation in space together with binaural rendering to simulate the position of sound sources. We present how these different elements of the sound design pipeline have been addressed in the literature, trying to find the trade-off between accuracy and plausibility. Recent applications and current challenges are also presented.