In this paper, we present the comprehensive version of CSIEC (Computer Simulation in Educational Communication), an interactive web-based human-computer dialogue system with natural language for English instruction, and its tentative application and evaluation in English education. First, we briefly introduce the motivation for this project, survey the related works and illustrate the system structure with flow diagram. Then we describe its pedagogical functions, especially free chatting and chatting on a given topic. We summarise the free Internet usage within 6 months and introduce its integration into English classrooms, as well as the formal evaluation results of the integration. The evaluation findings show that the chatting function has been improved and fully used by the users, and the application of the CSIEC system in English instruction can motivate the learners to use English and enhance their learning process. Lastly, we discuss the application-driven approach of system development and draw some conclusions for future improvement.