Electronic networks provide new opportunities to create functional learning environments which allow students in many different locations to carry out joint educational activities. A set of participant observation studies was conducted in the context of a cross-cultural, cross-language network called the Intercultural Learning Network in order to evaluate the potential of this interactive medium for instruction. This network was established in the spring of 1984 with a series of pilot projects conducted between San Diego (California), Tijuana (Mexico), and Juneau (Alaska). Goals of the network are to: (1) facilitate interaction across cultural boundaries in joint problem solving in real and simulated instructional domains; (2) provide a motivating context for the development of literacy skills in local and foreign languages; (3) educate students about cultural diversity, ethnocentrism, and cultural relativism; and (4) promote the exploration of and exposure to local and foreign culture, norms of behavior, tradition, and values. Since 1984, the network has expanded to more sites around the world and into a broader range of activities, including joint social science studies, functional language learning activities, and distributed problem solving projects. Initial findings indicate that the Intercultural Learning Network is meeting its goals. (39 references) (Author/GL)