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Research on the educational value of Virtual Worlds (VWs) has revealed their potential as future learning platforms. However, further studies are needed in order to assess their effectiveness in constructivist and collaborative learning paradigms. Problem-based learning (PBL) is an educational approach, in which students learn by addressing problems and reflecting on their experiences. The paper investigates the suitability of VWs as a platform for hosting PBL activities and explores their strengths and difficulties in terms of collaboration support and learning effectiveness. We have set up an educational VW, developed a number of in-world supporting tools, and ran a complete PBL activity in the area of User Interface Design. We performed a thorough summative evaluation of the learning activity using questionnaires, in-world observation, dialogue analysis, tutors' assessment of the process and outcome, and …