Innovation Education (IE) is a new subject area in Icelandic schools. The aim of the subject is to train students to identify the needs and problems in their environment and to develop solutions: a process of ideation. This activity has been classroom based but now a Virtual Reality Learning Environment technology (VRLE) has been designed to support ideation. This technology supports online communications between students and teacher and enables them to develop drawings and descriptions of their solutions. The VRLE is network based and the students work online in the school with their ideas in real time. As this learning environment is new it is important to explore and evaluate its use and value. This paper describes the basic IE pedagogical model and the subsequent development of the VRLE. These are discussed in relation to constructivist learning theories.