Linden Lab - creator of the virtual computer world phenomenon Second Life - is opening its first European office in Brighton and Hove.

The move by the San Fransisco-based company is being hailed as a major coup for the city by those who work in the digital media industry.

Second Life is an online 3D community where people choose a digital representation of themselves - an avatar - and live a virtual life.

You can buy clothes, houses, furniture, buy and sell land, make friends, chat people up at the bar and organise events. It's all fake of course but the money isn't.

Adidas, Dell, General Motors and Reuters are just four of the real world commercial enterprises buying Second Life islands as advertising platforms.

IBM, for example, has used one its islands to create a virtual store for its electronics retailer Circuit City. In doing so it hopes that Second Life game players will be encouraged go to a real Circuit City store and make a real purchase.

In January this year Sweden announced it was becoming the first country to open an embassy in the internet fantasy land in a bid to "reach more young people".

And last week news agency PA kept residents of Second Life updated with a live feed of news to its Budget Info- Station while bloggers in the virtual world could pick up the Budget announcements on the blogHUD.com community.

Linden Lab says there are almost five million Second Life residents around the world.

Now the company is coming to Brighton, where it hopes to employ ten to 15 people. But a spokesman said a site for the office had not yet been found.

Linden is looking for "wickedly brilliant software development generalists" to work on Second Life's real-time 3D graphics engine, backend network and physics engine.

Anthony Mayfield, a content worker with Brighton-based search marketing consultancy Spannerworks, welcomed the virtual world to the city. He said: "I hope that Linden Lab succeed and grow their base in Brighton. It's a badge of honour for the city to have them come here. Anyone else thinking of opening up a web company in the UK could do worse than come and take a look at the talent base and excellent lifestyle of Brighton and Hove."

Brighton has become a hub for games development firms with the likes of Relentless, NCSoft, Babel Media and Disney Interactive Studios' racing team based here.