Virtual Space Teleconferencing System (VST), which based on video teleconferencing system, is a combination of Virtual Reality and several other techniques, such as Network Communication and Natural Language Processing. Participants appear in computer-generated virtual spaces as avatars in VST, and these avatars can locate, view, manipulate virtual objects, communicate with others face to face, so participants could share 'the same space' and do cooperative work. When participants use different kinds of natural language to communicate, language barrier would arise in interaction. So, besides the basic natural language processing, VST should provide translation service based on Machine Translation. First, this paper introduces the features of VST. Second, it describes the techniques of English-Chinese Bi-directional Machine Translation. Third, it analyzes the special requirements of English-Chinese bilingual interaction environment in VST. Finally it discusses the key issues of English-Chinese bilingual interaction environment and proposes a method of construction.