Averageif() and OR() AND() functions

I have run into this a couple of times, but sometimes I have tried to create an averageif with an equivalent of the OR() function and sometimes with an AND() function. I have not actually used this functions, but I have used them in Excel 2003:

=AVERAGE(if((Sheet1!$A:$A="REG")*(Sheet1!$A:$A="CT"),Sheet1!$B:$B)

However, I would like to do this all in Excel 2007 without using control shift and enter.I have tried something similar to this with no luck

=AVERAGEIFS(Sheet1!$B:$B,Sheet1!$A:$A,or("REG","CT"))

I will probably add some more parameters too, so using a countif with the sumif might create one long formula. Can this even be created within an 2007 Excel Averageif statement?