In the fission yeast S. pombe, the RNA interference (RNAi) pathway is required to generate small interfering RNAs (siRNAs) that mediate heterochromatic silencing of centromeric repeats. Here, we demonstrate that RNAi also functions to repress genomic elements other than constitutive heterochromatin. Using DNA adenine methyltransferase identification (DamID), we show that the RNAi proteins Dcr1 and Rdp1 physically associate with some euchromatic genes, noncoding RNA genes and retrotransposon long terminal repeats, and that this association is independent of the Clr4 histone methyltransferase. Physical association of RNAi with chromatin is sufficient to trigger a silencing response but not to assemble heterochromatin. The mode of silencing at the newly identified RNAi targets is consistent with a co-transcriptional gene silencing model, as proposed earlier, and functions with trace amounts of siRNAs. We anticipate that similar mechanisms could also be operational in other eukaryotes.