Virtual reality (VR) for Language learning has been shown effective in improving students' communication skills. However very few studies reveal the communication strategies students used in communicating in a VR environment, especially in learning Chinese as a foreign or second language (CFL/CSL). In this pilot study, a prototype Virtual Experiential Language Learning Environment (VELLE) was used to provide immersive learning experiences in developing CFL students' communication strategies. Productive Failure was employed as an instructional approach to support the learning design. The participants were six CFL students learning in an Australian university. The main data sources included audio recordings of the students' communication in VR and interview data. The findings showed that participants' use of various types of communication strategies was influenced by the VELLE and Productive Failure design. In particular, the use of L1 in the problem-solving phase enriched the participants' learning opportunities and all participants used a lesser number of resource deficit-related strategies after the instruction. Second, Students reported enhanced engagement in language use in the VR context.