What are Groups?
Like in a live classroom, teachers can create virtual workgroups among course participants. Before creating the groups, you need to change the default Group setting on the course from "No" to either Separate or Visible. The difference is whether you want the groups to be able to see each other's work or to work separately among themselves within their groups.
Once the course setting is turned on, the Groups can be created in a few steps:
Step 1: Choose Groups Command
While you are in the course, select the Groups command from the Administration panel.
Step 2: Use the Create Group command.
There are several buttons to manage the groups. To create a new group, use the Create Group button.
Step 3: Name Group
Once you Name the group, you can adjust the settings, even add an optional image or enrollment key for additional layer of security on the group level.
Repeat as necessary to get the number of groups needed for the course.
Step 4: Assign Group Members
Use the Add/Remove button to assign group membership. Note that users must be in the course in order to be a part of any group. You can move them from the course into any group.
You can also add them to more than one group. You will not see the options to add or remove them to a group until you select a group and then click the Add/Remove button. You probably want to add all teachers to all groups.
You can use the Control (Ctrl) button to select and move more than one student at a time to the group.
Once you click the Back to Groups button, you can display group members by selecting the group and clicking the "Show members for group button. Otherwise you will see the members of the last group you were working on.
Learn Groups from Moodle.org
Instruction from the Moodle website on Groups. Now that you have created your groups, check out what the Group experience is like. Find out what they can do within the group and how the dynamics work.