In recent years, the combinations of computational and molecular approaches have led to the identification of an increasing number of small, noncoding RNAs encoded by bacteria and their plasmids and phages. Most of the characterized small RNAs have been shown to operate at a posttranscriptional level, modulating mRNA stability or translation by base-pairing with the 5' regions of the target mRNAs. However, a subset of small RNAs has been found to regulate transcription. One example is the abundant 6S RNA that has been proposed to compete for DNA binding of RNA polymerase by mimicking the open conformation of promoter DNA. Other small RNAs affect transcription termination via base-pairing interactions with sequences in the mRNA. Here, we discuss current understanding and questions regarding the roles of small RNAs in regulating transcription.