In this work, we propose a sensor localization system assisted by wireless communication and augmented reality (AR) suitable for indoor localization. Future handheld and unattended devices will be equipped with technologies, which have the means to enable localization in indoor environments. These include visual odometry based on cameras and augmented reality, and communication hardware such as UWB. Integration of such technologies to exploit their advantages allows us to compensate for and negate each other’s errors in measurements. This in turn can improve the overall function of future services, such as visual representation of sensing information from sensors in areas that are not physically visible. However, existing work cannot fully exploit these technologies to high extent, often inducing more errors or wasted resources. In our proposed system, we specifically propose an improved method of utilizing virtual anchors for localization, which is based on a cluster-based selection algorithm that allows the system to improve the positioning accuracy through angular diversity while also improving resource utilization. Our work has been fully implemented and tested on several indoor environments, showing that it can outperform existing methods.