CSIEC (Computer Simulation in Educational Communication), is not only an intelligent web-based human-computer dialogue system with natural language for English instruction, but also a learning assessment system for learners and teachers. Its multiple functions including grammar gap filling exercises, talk show, free chatting and chatting on a given topic, can satisfy the various needs from the students with different backgrounds and learning abilities. After the brief explanation of the motivation and the survey of the related works, we illustrate the system structure, and describe its pedagogical functions with the underlying AI techniques in details such as NLP and human-computer interaction. We summarize the free Internet usage from a six months period and its integration into English classes in universities and middle schools. The evaluation findings show that the chatting function has been improved and frequently utilized by the users, and the application of the CSIEC system on English instruction can motivate the learners to practice English and enhance their learning process. Finally, we draw some conclusions for the future improvement.