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Discrimination and prejudice against lesbian, gay, bisexual, transgender, questioning, intersex and asexual+ (LGBTQIA+) individuals exacerbate social anxiety. Communication via avatars in virtual communities may be an effective strategy to reduce related symptoms. This study measured social anxiety in LGBTQIA+ and non‐LGBTQIA+ individuals among Japanese users of Pigg Party, a massively multiplayer online game, in physical and virtual communities that use avatars for communication. They answered questions on social anxiety in physical and virtual communities and avatar identification (i.e., the degree of identification of the avatar with the self). The number of avatar customizations and amount of communication via avatars (indexed by the number of virtual peers) were collected based on game logs. The results revealed that the LGBTQIA+ group exhibited significantly higher rates of social anxiety in physical but not virtual communities than the non‐LGBTQIA+ group. Moreover, the LGBTQIA+ group displayed higher levels of identification with avatars than the non‐LGBTQIA+ group. Increased identification with avatars and avatar customization correlated with an increased number of communications via avatars, which was consequently linked to reduced social anxiety in physical and virtual communities. These findings suggest that communication using avatars can reduce social anxiety among LGBTQIA+ individuals. [ABSTRACT FROM AUTHOR]