If you want to set-up group projects in Moodle, one option is to use the Group Self-Selection tool. This allows students to form groups themselves, either by choosing from a set of groups you create and provide, or even by creating their own groups.
There are a lot of options in this tool, but in this article we will walk through a simple set-up.
Turn editing on by either:
In the section where you’d like to add content, click Add Activity/Resource.
From the Activity chooser select Group self-selection and click Add.
Go through the settings for the self-selection activity.
These settings control what special permissions have in creating or modifying groups; you may want to turn off Participants can create groups if you want them to stick to the ones you provide.
These are advanced settings that you probably don’t need to change, but feel free to experiment.
Once you have the settings the way you want them, go ahead and Save and return to course.