Virtual spatial modulation (VSM) has arisen as a promising technique for improving the energy efficiency (EE) of multiple-input multiple-output (MIMO) systems. However, due to utilizing only a subset of virtual parallel channels, the spectral efficiency (SE) of VSM is degraded compared to the classical MIMO system. To overcome this drawback, we propose an index and composition VSM (IC-VSM) technique to enhance the SE of the VSM scheme. In IC-VSM, the indices of active/inactive codeword of virtual parallel channels and compositions of an integer number are utilized to encode information, where the information bits compose of the channel activation patterns (CAPs), modulation symbols, as well as the energy allocation patterns (EAPs). We further propose a diversity-enhanced IC-VSM scheme through coordinate interleaving (CI). The average bit error probability (ABEP), asymptotic ABEP, and the diversity order are also derived to evaluate the performance of IC-VSM. Simulation results show that IC-VSM scheme outperforms the state-of-the-art SM schemes, i.e., VSM, particularly at high signal-to-noise ratio (SNR), and corroborate the validity of ABEP theoretical analysis.