The integration of values education into English language teaching is not common. Yet educators, school heads, and teachers regard values education as vital to help build students’ characters. This study aims to investigate how values can be promoted by using the approach of moral dilemma discussions in English language teaching. Specifically, within Thomas Lickona’s (1991) framework of values that posits the mutual interaction of students’ moral knowing, moral feeling and moral action, this study used action research as the research design, while applying the approach of moral dilemma discussions to examine whether students’ moral reasoning could be developed, moral feeling could be aroused, and whether obvious behavioural changes in moral action could be observed.A mixed-method of collecting both qualitative and quantitative data was used to evaluate the teaching process and teaching outcomes. Qualitative data included teacher researcher’s observation in class and after-lesson reflections, students’ discussions and responses during lessons, group interviews of students and teacher observers’ feedback. Quantitative data consisted of comparison between the pre-test and post-test scores of DIT2 and APASO-II, while the yearly moral performance record and result of the questionnaire set by the teacher researcher were used as supporting evidence.The findings showed an increase in the moral reasoning scores of the experimental group. Students were impressed with the moral dilemma discussion approach integrated with explicit values, and students’ moral development was shown in their assignments during the teaching process and teaching outcomes. Students’ sharing in the interviews also showed that they recognized the importance of values education for all students. However, an increase in moral action throughout the action research period was not obvious. More investigation into the link between moral reasoning and moral action should be done. All rights reserved.