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The organizational world has long recognized action learning (AL) as an invaluable tool for managerial development. However, AL's popularity among organizations did not translate into its adoption by business schools. A lack of evidence on what competencies AL fosters in students and whether these competencies transfer to practice has limited its wider acceptance. We address this issue by examining the learning outcomes of an undergraduate business program that has been using AL as a central didactical feature for the past 10 years. Based on a qualitative cross-sectional study following five alumni cohorts, results show that AL fosters the development of knowledge (theoretical and practical), skills (communication and collaboration), and attitudes (self-knowledge and self-efficacy); competencies graduates transferred to practice years after completing the program. Although management education has been continually criticized for its inability to provide undergraduates with the competencies necessary for practice, our study shows that AL contributes to narrowing this relevance gap. It also expands our understanding of the effectiveness and impact of AL beyond executive training to include undergraduate education, thus informing and inviting educators to consider AL as an alternative to expand their teaching practices.