This paper investigated the effect of task complexity on time estimation in the virtual reality environment (VRE) using behavioral, subjective, and physiological measurements. Virtual reality (VR) is not a perfect copy of the real world, and individuals perceive time duration differently in the VRE than they do in reality. Though many researchers have found a connection between task complexity and time estimation under non-VR conditions, the influence of task complexity on time estimation in the VRE is yet unknown. In this study, twenty-nine participants performed a VR jigsaw puzzle task at two levels of task complexity. We observed that as task complexity increased, participants showed larger time estimation errors, reduced relative beta-band power at Fz and Pz, and higher NASA-Task Load Index scores. Our findings indicate the importance of controlling task complexity in the VRE and demonstrate the potential of using electroencephalography (EEG) as real-time indicators of complexity level.