Could be many things, so I'll give you a few suggestions to start out...
1. Don't multi-task while you watch the movie. If significant amounts of RAM is being used by other apps, then this can cause a delay.
2. Try using a different player. Windows Media Player 6.4 comes with Windows as well, so try it or something other than WMP9 if that's what you're using. If the AVI is encoded with Divx, then you might try the Divx player.
3. Installing new codecs could make the problem worse, and also might not solve the problem if the player is using the same codec each time regardless of the new ones you install.
The original encoding can be bad, but if you watch many AVIs and always have this problem, then it is probably something wrong on your end. A little more info on your system might help, such as processor speed and amount of RAM. It might also help to know what codecs you've installed if you can provide that.