Ago proteins are members of the highly specialized and conserved Argonaute family, primarily responsible for regulation of gene expression. As a part of RNA-induced silencing complexes (RISCs) Ago proteins are responsible for binding a short RNA and cleavage/inhibition of translation of target mRNAs. Phosphorylation may work as the switch between those two functions, but the role of magnesium ion concentration is also taken into consideration. Recent reports indicate that Ago proteins can interact with an mRNA and cause inhibition of translation without the participation of a short RNA. As key elements in RNA interference processes, Ago proteins are an important and intensively exploited area of research. Furthermore, these proteins are involved in the repair of DNA double-strand breaks by homologous recombination, modifications of chromatin, and alternative splicing. Their role in the cell cycle and senescence is also being studied. In addition, Ago expression is tissue-specific, which potentially may be used for diagnostic purposes. Understanding the mechanisms of Ago functioning is therefore crucial for understanding many cellular processes. The following article presents a detailed description of the Ago proteins including their post-translational modifications, recent data and hypotheses concerning their interactions with short RNAs and mRNAs as well as the mechanisms of siRNA/miRNA sorting into individual members of the Ago subfamily, and their role in eukaryotic cells. The latest classification of Ago proteins within the Argonaute family based on evolutionary studies and their possible interactions with DNA are also described.