Enzymatic reactions of AGO4 in RNA-directed DNA methylation: siRNA duplex loading, passenger strand elimination, target RNA slicing, and sliced target retention.

RNA-directed DNA methylation in plants is guided by 24-nt siRNAs generated in parallel with 23-nt RNAs of unknown function. We show that 23-nt RNAs function as passenger strands during 24-nt siRNA incorporation into AGO4. The 23-nt RNAs are then sliced into 11- and 12-nt fragments, with 12-nt fragments remaining associated with AGO4. Slicing recapitulated with recombinant AGO4 and synthetic RNAs reveals that siRNAs of 21-24 nt, with any 5'-terminal nucleotide, can guide slicing, with sliced RNAs then retained by AGO4. In vivo, RdDM target locus RNAs that copurify with AGO4 also display a sequence signature of slicing. Comparing plants expressing slicing-competent versus slicing-defective AGO4 shows that slicing elevates cytosine methylation levels at virtually all RdDM loci. We propose that siRNA passenger strand elimination and AGO4 tethering to sliced target RNAs are distinct modes by which AGO4 slicing enhances RNA-directed DNA methylation.