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Purpose: This research reveals how a virtual exchange (VE) can foster transnational collaboration in higher education, assist students acquire key learning outcomes and raise awareness regarding the complexities affecting development policy and sustainability. The purpose of this paper is to address these issues. Design/methodology/approach: Overall 50 students from two universities in Spain and the United Kingdom, enrolled on two different degree courses (Global Studies and Marketing), cooperated in multidisciplinary teams to analyze real development policies and initiatives. The authors collected quantitative and qualitative data to assess the students' perceptions of the methodology. Findings: The students perceived the VE to be of great value, enriching their educational experience by having a positive effect on their overall learning and fostering internationalization. A high number of participants declared the teaching and learning methodology was useful to assist them in reaching crucial cognitive, skill-based and affective educational objectives, and to help them understand how development policy works while also raising awareness regarding real-world complexity. Practical implications: This methodology proved valuable in helping students acquire the set of skills expected from today's graduates in economics, political science and marketing. This active learning and pedagogical innovation component provides some interesting conclusions contributing toward widening the adoption of VEs in higher education contexts. Originality/value: The increasing complexity of the globalized world makes it challenging for higher education institutions to develop multidisciplinary approaches to education to foster sustainable development. The experience provided offered the students an online international experience at their home institutions. Consequently, the research elaborates on how VE can be applied in economics, business, management and political science courses to enrich learning experience by applying theory in a practical way. [ABSTRACT FROM AUTHOR]