This paper explores and discusses arguments for the use of virtual environments and interactive avatars in supporting the achievement of student learning goals within conventional educational contexts. It describes and evaluates arguments promoted by some authors (eg, van den Brekel, 2007; Deuchar & Nodder, 2003; Dickey, 2003; Facer, 2004; de Freitas, 2006; de Freitas & Oliver, 2006; Garris, Ahlers & Driskell, 2002; JISC, 2007; Martino, 2007; Prensky, 2004; Prensky, 2007) relating to advantages from gaming and avatar use, ranging from enhanced engagement in learning activities, through to more purposeful and focussed communication, and, when used in group situations, better cooperation and collaboration between students. It explores the potential of avatar environments to act as powerful communication mediums for students to display knowledge and understanding, and engage in the development of "higher order thinking skills, such as interpreting, analysing, evaluating, synthesising and solving complex problems". It also introduces and discusses the avatar-based authoring program MARVIN, and identifies potential for its use as a digital storytelling tool to assist students in communicating outcomes from units of learning, and in supporting the development of a range of key learning competencies identified in the New Zealand Curriculum Framework (Ministry of Education, 2007). It profiles a successful example of the classroom-based use of MARVIN within a community project undertaken by groups of year 7 and 8 students at two Hamilton intermediate schools, and identifies how the program supported student "thinking" and "relating to others" key competencies (Ministry of Education, 2007).