Purpose: The purpose of this paper is to report on a study into how a three-dimensional (3D) virtual world (Second Life) can facilitate socialisation and team working among students working on a team project at a distance. This models the situation in many commercial sectors where work is increasingly being conducted across time zones and between multiple teams. Collaboration in these geographically distributed teams is virtual rather than through face-to-face interactions. The paper investigates how a virtual world such as Second Life compares to other collaboration tools such as instant messaging or Skype; and the challenges that students experience in becoming acquainted with and working in Second Life. Design/methodology/approach: The paper has employed a qualitative research methodology involving data collection through group interviews, epistolary (email) interviews and semi-structured individual interviews. The data have been analysed by applying the inductive analysis technique. Findings: The analysis is presented through answers to questions which educators may have about the effectiveness of virtual worlds in supporting collaboration in virtual teams. Research limitations/implications: The paper highlights the pedagogical role of 3D virtual worlds in supporting communication, team working and community building. The methodology will be of interest to researchers in the area of virtual worlds as there is little guidance in the literature about how to evaluate student experiences of these environments. Practical implications: The research reported in this paper is timely and significant in view of current business scenarios such as the challenges of a globally distributed work-place, the need to offer training to develop employees' skills of working in distributed environments and to meet changing market needs. Furthermore, the research will support the development of a coordinated response to the Leitch review of skills in the UK, which identified issues of resource-intensive travel, global warming and the need for businesses to be seen as "green" for customer attraction and retention. Originality/value: The paper discusses the role of 3D virtual worlds in supporting student team projects involving students who are geographically dispersed. The sense of visual presence and of place in a 3D world can make socialising in a virtual world, a more "human" experience than in 2D environments such as web sites, e-mail, wikis and blogs, and even phone or video-conferencing. The research reported in this paper could enhance uptake of 3D virtual worlds by organisations facing the challenges of facilitating socialisation and knowledge sharing in a distributed workforce. (Contains 5 figures and 21 notes.)