The discovery of RNA interference (RNAi), the process of sequence-specific gene silencing initiated by double-stranded RNA (dsRNA), has broadened our understanding of gene regulation and has revolutionized methods for genetic analysis. A remarkable property of RNAi in the nematode Caenorhabditis elegans and in some other multicellular organisms is its systemic nature: silencing signals can cross cellular boundaries and spread between cells and tissues. Furthermore, C. elegans and some other organisms can also perform environmental RNAi: sequence-specific gene silencing in response to environmentally encountered dsRNA. This phenomenon has facilitated significant technological advances in diverse fields including functional genomics and agricultural pest control. Here, we describe the characterization and current understanding of environmental RNAi and discuss its potential applications.