Purpose: The purpose of this paper is to identify the factors which enhance transformational learning in adult learning spaces for people experiencing cultural marginalisation. Design/methodology/approach: This paper reports on a study which compared the transformational experiences of long-term unemployed migrants within two very different programs in Melbourne, Australia. One was an adult refugee mentoring programme run by a non-government organisation, the other was set in the social space of the contemporary adult learning classroom. A theoretical framework constructed around understandings of social and dialogical learning informed the method of data collection, based on one-to-one interviews, observation and personal reflection. Findings: Findings revealed similarities across the two case study sites in terms of the cultural, social as well as functional challenges facing learners and the desire of teachers and mentors to act on these challenges. A recourse to human values of caring and sensitivity supported meaningful learning spaces. Transformation was limited, however, within an institutional agenda which highlighted individual values of competency above the aspirations of learners and their sense of identity. Research limitations/implications: This research focuses on only two of the many approaches to adult learning. Nevertheless, as the author contends, they collectively reveal the limitations of focusing on employability skills and a competency-based curriculum in the lives of marginalised learners. Originality/value: The paper draws attention to the concept of transformation and how it may be supported even in the adult education classroom framed by the neo-liberal agenda of economic rationalism.