Gene expression in eukaryotes is controlled at transcriptional and post-transcriptional levels by RNA dependent mechanism called as "RNA Interference" or "RNA Inhibition". Small inhibitory RNAs (siRNAs) formed by the cleavage of double stranded RNAs activate the mechanisms which control cellular activities in organisms as diverse as protozoa, fungi, plants and primates. RNA interference participates in cellular functions such as heterochromatin formation, controlled DNA elimination, defence against foreign nucleic acids, maintenance of expression patterns via conserved proteins. Its effect is also generalized and amplified in some organisms. RNA interference is widely used as a biotechnological method for gene function studies and can also be potentially employed as a gene therapy approach for certain autoimmune, neoplastic and infectious diseases. In this review, the mechanism of RNA interference and its therapeutic applications have been discussed, focusing on viral diseases.