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This article reports on intercultural learning by participants in an Internet chat exchange between prospective teachers studying English in Chile and graduate students from a distance learning practicum class in California. To highlight issues of identity in such exchanges, we present case studies of discussions in two online chat groups led by graduate students with contrasting linguistic and cultural backgrounds. In our discourse analysis of the chat transcripts from these two groups, we found differences in how participants oriented to local, national, and global contexts, with one group primarily discussing political and educational issues from a global perspective, while the second group responded to the same issues by giving local examples. We conclude by discussing pedagogical implications for future Internet exchanges that aim to foster intercultural learning within a transnational paradigm of foreign language education. [ABSTRACT FROM AUTHOR]