The scientific goal of this proposal is to contribute to our understanding of RNA-mediated epigenetic mechanisms of genome regulation in eukaryotes. Choosing ciliated protozoa as model organisms gives a wonderful opportunity to study the incredibly complex epigenetic mechanism of programming large-scale developmental rearrangements of the genome. This involves extensive rearrangements of the germline DNA, including elimination of up to 95% of the genome. The massive DNA rearrangement makes ciliates the perfect model organism to study this aspect of germline-soma differentiation. This process is proposed to be regulated by an RNA-mediated homology-dependent comparison of the germline and somatic genomes. Ciliate’s genomic subtraction is one of the most fascinating examples of the use of RNA-mediated epigenetic regulation, and of a specialized RNA interference pathway, to convey non-Mendelian inheritance in eukaryotes. The ‘genome scanning’ model raises many interesting questions, which are also relevant to other RNA-mediated regulation systems. One of the most intriguing is a ‘thermodynamic’ problem: the model assumes that a very complex population of small RNAs representing the entire germline genome can be compared to longer transcripts representing the entire rearranged maternal genome, resulting in the efficient selection of germline-specific scnRNAs, which are able to target DNA deletions in the developing nucleus. How is it possible that the truly enormous number of pairing interactions implied can occur in such a short time, just a few hours? RNA-RNA pairing interactions would probably have to be assisted by a dedicated molecular machinery. This proposal focuses on characterizing proteins and RNAs that can orchestrate the massive genome rearrangements in ciliates.