We describe the design rationale and structure of a Methods for Teaching Physics course that was redesigned as a project-based learning (PBL) environment, and the entailed learning process it fostered. The projects consisted of the design and teaching of physics lessons with predefined content and pedagogical focus and were structured as a guided cycle of inquiry into and sensemaking of the students' pedagogical design and teaching. A unique feature of the course was the structured guidance and scaffolding the students received during the design phase. We illustrate the learning process that was fostered through a case study of a pair of students who worked collaboratively on a project. The data include the evolving versions of the lesson plan (three drafts and the final plan), transcripts from two consultation meetings with the instructors, as well as written correspondence on the course website, and the students' written reflections after watching the video of the lesson they taught. The case study illustrates a learning process that led to an understanding of the difference between knowing the content and teaching it, and a shift in attention from 'what I teach' to 'how my students learn'.