Duplex RNAs complementary to messenger RNA inhibit translation in mammalian cells by RNA interference (RNAi). Studies have reported that RNAs complementary to promoter DNA also inhibit gene expression. Here we show that the human homologs of Argonaute-1 (AGO1) and Argonaute-2 (AGO2) link the silencing pathways that target mRNA with pathways mediating recognition of DNA. We find that synthetic antigene RNAs (agRNAs) complementary to transcription start sites or more upstream regions of gene promoters inhibit gene transcription. This silencing occurs in the nucleus, requires high promoter activity and does not necessarily require histone modification. AGO1 and AGO2 associate with promoter DNA in cells treated with agRNAs, and inhibiting expression of AGO1 or AGO2 reverses transcriptional and post-transcriptional silencing. Our data indicate key linkages and important mechanistic distinctions between transcriptional and post-transcriptional silencing pathways in mammalian cells.