Background: Xbox Kinect-based virtual reality, being a novel approach, has therapeutic benefits in rehabilitation and its use is encouraged in stroke rehabilitation of upper extremities. Objective: Primary aim of the current study is to investigate the additional effects of Xbox Kinect training in combination with routine physiotherapy exercises based on each component of Fugl-Meyer Assessment Scale for Upper Extremity (FMA-UE). Moreover, effect of upper limb rehabilitation on cognitive functions was also assessed. Methods: This study was a parallel arm randomized control trial. Fifty-six participants were recruited and randomly allocated to either an Xbox Kinect training group (XKGT) or exercise training group (ETG). Measures of concern were recorded using FMA-UE, Box and Block Test (BBT), and Montreal Cognitive Assessment (MOCA). Evaluation was conducted at baseline and after completion of intervention at the sixth week. Results: There were significant differences from pre- to post-intervention scores of FMA-UE and BBT (p < 0.001) in both groups, whereas no difference was observed for MOCA (XKTG p value 0.417, ETG p value 0.113). At six-week follow-up there were significant differences between both groups in FMA-UE total score (p < 0.001), volitional movement within synergies (p < 0.001), wrist (p = 0.021), hand (p = 0.047), grasp (p = 0.006) and coordination/speed (p = 0.004), favoring the Xbox Kinect training group. Conclusion: To conclude, results indicate repetitive use of the hemiparetic upper extremity by Xbox Kinect-based upper limb rehabilitation training in addition to conventional therapy has a promising potential to enhance upper limb motor function for stroke patients.