I reject your premise. The issue of what makes an anime an anime is directly related to this question, and that is a reasonable topic for a discussion here.
It also suggests that, ideally, I could say "no, it isn't" and lock the thread. On top of being gratitutous and unnecessary, that would have been boring as hell. Instead we have a variety of answers explaining why it's not and some dialogue on other points, which is productive and interesting.
Many good points have been made. I take MonkeyFunk's point about the insignificance of semantics, but having said that there are reasons I care enough to argue the point. For starters, truth exists and worRAB mean things. Since "anime" can be applied to quite a lot as-is, I'm not inclined to see it reduced to the point where it means almost anything that a user of the word wants it to mean. Anime shouldn't be used as a kneejerk definition just because something "looks asian" to someone. At times like that, Jeff Harris' desire to just use "animation" for everything and call it a day looks very appealing.
Your average English-speaking person thinks "Japanese cartoons" when they see or hear the word "anime." That's what we've become used to. So if fans run around assigning that to Avatar, that's not good. That's liable to spread misinformation. That's part of why this thread even exists, with no disrespect intended to the creator. For some people out there it's actually a question. But Avatar was an American show produced at Nickelodeon Animation Studios in Burbank, California, and I'm a believer in credit going where it's due. There's a world of difference between creating something and influencing something. And damn it, the creators should get the praise they deserve, rather than see it passed off on the objects of their research.
Also, not everywhere is like Toon Zone. Some people are Japanaholics and don't want to give non-Japanese sources the credit they deserve. Personally, I won't play that game or cede them any ground. Quality exists on multiple fronts, and the word "cartoon" just does not deserve to be divorced from that term.