How can a shell function know if it is running within a virtualenv?

if [[ "$VIRTUAL_ENV" != "" ]]
then
  INVENV=1
else
  INVENV=0
fi
// or shorter if you like:
[[ "$VIRTUAL_ENV" == "" ]]; INVENV=$?

EDIT: as @ThiefMaster mentions in the comments, in certain conditions (for instance, when starting a new shell – perhaps in tmux or screen – from within an active virtualenv) this check may fail (however, starting new shells from within a virtualenv may cause other issues as well, I wouldn’t recommend it).