During the past decade, design-based research has demonstrated its potential as a methodology suitable to both research and design of technology-enhanced learning environments (TELEs). In this paper, we define and identify characteristics of design-based research, describe the importance of design-based research for the development of TELEs, propose principles for implementing design-based research with TELEs, and discuss future challenges of using this methodology. (http://www.springerlink.com/content/a582109091287128/)