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Across kingdoms, RNA interference (RNAi) has been shown to control gene expression at the transcriptional- or the post-transcriptional level. Here, we describe a mechanism which involves both aspects: truncated transgenes, which fail to produce intact mRNA, induce siRNA accumulation and silencing of homologous loci in trans in the ciliate Paramecium We show that silencing is achieved by co-transcriptional silencing, associated with repressive histone marks at the endogenous gene. This is accompanied by secondary siRNA accumulation, strictly limited to the open reading frame of the remote locus. Our data shows that in this mechanism, heterochromatic marks depend on a variety of RNAi components. These include RDR3 and PTIWI14 as well as a second set of components, which are also involved in post-transcriptional silencing: RDR2, PTIWI13, DCR1 and CID2. Our data indicates differential processing of nascent un-spliced and long, spliced transcripts thus suggesting a hitherto-unrecognized functional interaction between post-transcriptional and co-transcriptional RNAi. Both sets of RNAi components are required for efficient trans-acting RNAi at the chromatin level and our data indicates similar mechanisms contributing to genome wide regulation of gene expression by epigenetic mechanisms.

Two sets of RNAi components are required for heterochromatin formationin transtriggered by truncated transgenes