My thesis aims to explore the connection between the avatar and the individual in a virtual environment. Emphasising the importance of the avatar's presence and embodiment experience, I demonstrate how users with virtual bodies experience virtual reality and how this affects cognitive processing and memory. I analyse the negative effects of disembodiment through various research examples, and then demonstrate how cognitive neuroscience findings on body ownership explain the psychological aspects of avatar use. In the context of the Proteus effect, I discuss how individuals move away from their everyday identity in favour of an online identity. I also show the extent to which the customisation of avatars contributes to self-expression and the development of personal behaviour, attitudes, and body image. Based on experiment results, I confirm that the presence of a virtual body has a positive effect on cognitive performance and the effectiveness of social interactions, thus enriching the VR experience.