Night mode is an automatic setting which takes advantage of the new wide-angle camera that's in the iPhone 11 and 11 Pro models. It's equipped with a larger sensor that is able to let in more light, allowing for brighter photos when the light is low.
16" MacBook Pro Now Available
Apple Researching Virtual Reality Headsets
Apple suggests that by detecting the user's movements, the image could be adjusted accordingly:
For example, the device may detect a user's head movement and cause the portion of media displayed to reflect the head movement.Apple even makes the point that they could take the realism so far as adding theatre surroundings, adjusting sound effects based on the user's "seat" and even adding outlines of other patrons sitting in the theatre.
It's not unusual for Apple's patent applications explore novel concepts but Apple has published previous patents related to similar headsets.