RNA interference (RNAi) is a universal and evolutionarily conserved phenomenon of post-transcriptional gene silencing by means of sequence-specific mRNA degradation, triggered by small double-stranded RNAs. Because this mechanism can be efficiently induced in vivo by expressing target-complementary short hairpin RNA (shRNA) from non-viral and viral vectors, RNAi is attractive for functional genomics and human therapeutics. Here we systematically investigate the long-term effects of sustained high-level shRNA expression in livers of adult mice. Robust shRNA expression in all the hepatocytes after intravenous infusion was achieved with an optimized shRNA delivery vector based on duplex-DNA-containing adeno-associated virus type 8 (AAV8). An evaluation of 49 distinct AAV/shRNA vectors, unique in length and sequence and directed against six targets, showed that 36 resulted in dose-dependent liver injury, with 23 ultimately causing death. Morbidity was associated with the downregulation of liver-derived microRNAs (miRNAs), indicating possible competition of the latter with shRNAs for limiting cellular factors required for the processing of various small RNAs. In vitro and in vivo shRNA transfection studies implied that one such factor, shared by the shRNA/miRNA pathways and readily saturated, is the nuclear karyopherin exportin-5. Our findings have fundamental consequences for future RNAi-based strategies in animals and humans, because controlling intracellular shRNA expression levels will be imperative. However, the risk of oversaturating endogenous small RNA pathways can be minimized by optimizing shRNA dose and sequence, as exemplified here by our report of persistent and therapeutic RNAi against human hepatitis B virus in vivo.