Apple's AR headset, codenamed N301, reportedly has AR and VR capabilities and is planned to be released in 2022.
The headset will have a focus on gaming, watching video, and virtual meetings.
A smaller pair of glasses that are designed to be worn for a longer period of time will be released in 2023.
These glasses currently look like high-priced sunglasses with thick frames. Both devices will use a more advanced version of the Face ID camera.
Apple and other tech companies are now looking to virtual and augmented reality as the next big tech platforms.
Rivals like Facebook, Microsoft, and Google have been heavily investing in AR/VR projects.
Google has recently ended its Daydream experiment due to a lack of developer adoption and decreasing usage from customers.