In an isothermal process, the temperature of the system remains constant. Since the internal energy of an ideal gas depends only on temperature (according to the first law of thermodynamics), if the temperature is constant, the internal energy also remains constant. In the case of isothermal expansion, the gas does work on the surroundings, but this energy is provided by the heat absorbed from the surroundings, so the internal energy does not change.
Therefore, the correct answer is option (C).