Driving phobia is an anxiety disorder. People are greatly impaired in their daily lives when suffering from driving phobia disorders. The anxieties can be triggered under various conditions, such as driving over bridges, driving at high speeds, or driving in close proximity to large trucks. Traditional cognitive behavioral therapy (CBT) and exposure therapy are the most common approaches used in the treatment of psychological disorders, such as anxiety disorder (AD) and panic disorder (PD). This research focuses on virtual reality (VR)-based exposure therapy, called VRET, and describes the design and development of a system which uses alternating levels of fear-based driving scenarios that can be recorded and automatically adjusted to maximize exposure effectiveness without causing the subjects to panic. The proposed VRET integrates an advanced feedback database module for tracing and analyzing the system, along with the user's bio-data to show the valid data collection of the system and its effectiveness for future use in clinical trials. The research conducts a system's pre-test analysis using 31 subjects to demonstrate the effectiveness of the system. This research demonstrates the systematic development of the VRET for driving phobia disorder by depicting the system framework, key system modules, system integration, bio-database management, and pre-test data analysis to support our next research efforts in hospital-based clinical trials and for additional VRET development applications for clinical psychology.