This study investigates how three-dimensional virtual environments (3DVEs) support shared understanding and group decision making. Based on media synchronicity theory, we pose that the shared environment and avatar-based interaction allowed by 3DVEs aid convergence processes in teams working on a decision-making task, leading to increased shared understanding between team members. This increases team performance. An experiment was conducted in which 70 teams of three participants had to decide on a spatial planning issue. The teams interacted using synchronous text-based chat, a 3D virtual decision room, or were present in the virtual environment (VE) mirroring the spatial planning task. Results revealed that in the virtual decision room and the VE, shared understanding was higher than in the text-based chat condition. This led to higher task performance in terms of consensus, satisfaction, and cohesion. Our results show that 3DVEs offer potential for team collaboration over more traditional text-based collaboration technologies.