This paper presents a three-year participatory action research project focusing on the graduate level course entitled Visual Learning in 3D Animated Virtual Worlds. The purpose of this research was to understand "How the virtual world processes of observing and creating can best help students learn visual theories". The first cycle of this research revealed that hands-on virtual world experiences do help students perceive the real world environment and learn visual theories. The second cycle of the research showed that a teacher-free learning environment was well perceived by students. The third cycle of the research showed that the intensive course did not allow students to have time to reflect or form the deeper understanding necessary for making connections between theory and practice. Therefore, this research suggests that the best way to help students learn visual theories is through creating a teacher-free visual learning environment within the span of a regular course.