This research study examines learner perceptions of benefits and challenges associated with the Neighborhood (NBH), an innovative pedagogy that fosters learner engagement and integration of nursing concepts using a “virtual community” as an alternative to lecture. First-semester students from five baccalaureate nursing programs that used the NBH intervention were divided into high (N = 78) and low faculty use (N = 203) groups. Qualitative analysis revealed that the NBH intervention promoted application of concepts to real life situation was engaging and “eye-opening,” allowing students to understand health care issues from a variety of perspectives. A major challenge was busy work generated by faculty assignments unrelated to enhancing conceptual clarity. Statistical analyses indicate that benefits and challenges grow together; benefits outweigh challenges and net benefit increases with increased faculty use. This study highlights the need to provide initial and ongoing training and support to faculty at schools who adopt this intervention.