Small hairpin RNAs (shRNAs) are widely used in RNAi studies and typically consist of a stem of 19-29 base pairs (bp), a loop of at least 4 nucleotides (nt), and a dinucleotide overhang at the 3' end. Compared with shRNAs with 21-29 bp stems, we have found that shRNAs with 19-bp or shorter stems (sshRNAs) possess some unique structure-activity features that depend on whether the antisense strand is positioned 5' or 3' to the loop (L- or R-type sshRNAs, respectively). L sshRNAs can have IC(50)s in the very low picomolar range, and sshRNAs with nominal loop sizes of 1 or 4 nt were at least as active as those with longer loops. L sshRNAs remained highly potent even when the 3' end of the antisense strand was directly linked with the 5' end of the sense strand. In this case, the sense strand can be shorter than the antisense strand, and the loop can be formed entirely by the 3' end of the antisense strand. Monomer sshRNAs are not processed by recombinant Dicers in vitro. Although they can form dimers that are sometimes Dicer substrates, their RNAi activity is not dependent on the formation of such structures. Our findings have implications for the mechanism of action of sshRNAs, and the ability to design highly potent shRNAs with minimal length is encouraging for the prospects of the therapeutic use of direct-delivered shRNAs.