This paper summarises some of the preliminary findings of the Inter-Life Project, funded by two leading UK research councils (ESRC and EPSRC 2008-2012). Inter-Life Island provided networks of support and various tools and resources to augment the opportunities available to young people in the ‘real world’. The paper presents some qualitative results of an extensive investigation that attempted to illustrate how virtual worlds may be used by young people to scaffold creativity, provide a network of support, and enable the sharing of creative knowledge and skills. The research team used Activity Theory (AT) because we contend that it can provide a way of reconceptualising transition, by focusing on the development of a broad range of skills that young people need to develop in order to cope with increasing and sometimes paradoxical demands, and yet still be able to identify and develop their own goals and motivations in a negotiable way. Our results indicate that ILI-2 became a place that both the research team and the YPs featured here were able to experience as an authentic environment in which to work and socialise. The island came to have a familiarity and a history as it was customised by the participants through the development of working areas, buildings and presentation tools. The young people reported that this created a sense of both ‘place’ and ‘group history’. These findings open up further multiple possibilities for the use of virtual worlds in education.