Virtual environments have the potential to be an important teaching tool for emotionally sensitive issues capable of producing a sense of presence, perspective-taking and introspection in users in a risk-free, rapid feedback experience. In designing such experiences, it is essential that users are regularly engaged in a collaborative design process. However, engaging in design, development, and evaluation can in itself provide a learning experience. Here, the authors present an approach to engaging children in the design, development and evaluation of a virtual learning environment, specifically a serious game, focused on inculcating empathy, ethical reasoning, and reflection for coping with bullying. It was demonstrated that children's involvement not only contributed to an improved virtual environment, but significantly engaging in the design process provided children with a novel and effective learning opportunity.