RNA interference (RNAi) can mediate gene silencing posttranscriptionally by target RNA cleavage, or transcriptionally by chromatin and DNA modification. Argonaute is an essential component of the RNAi machinery that displays endonucleolytic activity guided by bound small RNAs. This slicing activity has recently been shown to be required for gene silencing and spreading of histone modifications characteristic of heterochromatin in Schizosaccharomyces pombe. Argonaute proteins with catalytic and nucleic acid binding capacities are found to function in RNAi within both the plant and animal kingdoms. Here we review the requirement of slicing for silencing and spreading in S. pombe, plants, and humans.