This paper reports on a doctoral study that investigated an alternative pedagogical approach in an online VET teacher-education course offered at a mid-sized university in Australia. Students in the course were mature-aged and adding study to their role as in-service VET teachers. Building on previous research, a set of design principles was created to guide the development of the course and ensure it responded to the students' characteristics and provided an "applied learning" environment where theory and practice could be authentically integrated in their work contexts. The study evaluated the effectiveness of the design principles by investigating the experiences of the students and teaching staff over an 18-month period. In an era of increasingly diverse student cohorts and fully online courses, the applied learning design principles offer a contemporary framework to guide the development and delivery of courses.