The organisation of students into groups (or communities) for learning purposes is an established pedagogic method in higher education. Teachers are now using group methods in networked e-learning contexts, albeit without a full understanding of the dynamics of group work in these settings. This is a new and evolving arena in higher education. In this article, the learning dynamics of three collaborative, networked e-learning groups are examined in an attempt to understand how students work in them. A detailed ethnography indicates that two of the groups worked harmoniously, and successfully produced a collective end product. The other group exhibited extreme anxiety and division, and required extra resources from its members in order to sustain itself and produce its collective end product. Anxiety became a major focus for this group, which had the effect of diverting it from effective collective production. The ethnography shows that the place of identity, control, ontological security and guilt in collaborative e-learning groups can be central to the effective work of the groups. The difference between the groups with respect to these categories is used as a point of departure in order to show how an understanding of the dynamics of networked learning groups and communities may be of benefit to teachers and students working in these new environments.