RNA interference (RNAi) may be induced by a plasmid with an inverted repeat (IR) sequence directing transcription of hairpin-type double-stranded RNA (dsRNA). This study examines the effects of changing various parameters of IR constructs on Drosophila and mammalian RNAi, using the dual luciferase system, RNAi activity was found to vary depending on IR length ass well as the length and sequence of the internal loop separating sense and antisense sequences. Both transient and stable RNAi occurred in Drosophila cultured cells. Although transient DNA-mediated RNAi was noted in most mammalian cells, no mammalian cells stably possessing IR sequences and hence RNAi activity could be obtained. In Drosophila, DNA-mediated RNAi was considerably weaker than long-dsRNA-mediated RNAi. The cytological data indicated that this was most probably caused by abortive processing of hairpin RNA produced within cells. DNA-mediated RNAi was examined at the level of Drosophila individuals using extramacrochaetae as a model gene, and the presence of an intron sequence in the single-stranded loop region was shown to be essential for effective RNAi.