I do feel that deciding on student teams depends on the various tasks or assignments that the team will be working on together. Most of the time, I prefer to see teams selected by the teacher with a mix of diverse and different students in each group. I think that we need to take into account the personalities of students (quiet or more verbal), gender, ethnicity and work habits. Part of the learning process is having the group connect and learn how to get along in order to finish their problem or project. The size of the team will also vary but if possible, kept to around four or five students. This will aid in participation from each student. In fact, in order to have a collaborative effort by all members of the team, there should be a division of different jobs among the members of the team. This way each team member will know what their job is and how to reach the team goal at the end.
Working in a kindergarten classroom, when we have group centers or other group work times, we seldom let the students pick who they will work with. Even at this younger age, children have a tendency to pick friends and socialize too much. It also leads to leaving one or two students out of the mix and can lead to bad feelings. No one likes being the only one not picked for a group or team.
Here is a website that I found that gave more useful information regarding student teams:http://www.ncrel.org/sdrs/areas/issues/content/cntareas/science/eric/eric-7.htm