It is difficult to maintain cognitive functioning in threatening contexts, even when it is imperative to do so. Research indicates that precarious situations can impair subsequent executive functioning, depending on whether they are appraised as threatening. Here, we used virtual reality to place participants at ground level or at a virtual height in order to examine the impact of a threat-related context on concurrent executive function and whether this relationship was modulated by negative appraisals of heights. Executive function was assessed via the Go/NoGo and N-Back tasks, indexing response inhibition and working memory updating respectively. Participants with negative appraisals of heights exhibited impaired executive function on both tasks when performing at a virtual height (i.e., a threat-related context) but not at ground-level, demonstrating the importance of considering the cognitive consequences of individual differences in negative interpretations of emotionally-evocative situations. We suggest that a virtual reality approach holds practical benefits for understanding how individuals are able to maintain cognitive ability when embedded within threatening situations.