Recent studies on the control of specific metabolic pathways in bacteria have documented the existence of entirely RNA-based mechanisms for controlling gene expression. These mechanisms involve the modulation of translation, transcription termination or RNA self-cleavage through the direct interaction of specific intracellular metabolites and RNA sequences. Here we show that an analogous RNA-based gene regulation system can effectively be designed for mammalian cells via the incorporation of sequences encoding self-cleaving RNA motifs into the transcriptional unit of a gene or vector. When correctly positioned, the sequences lead to potent inhibition of gene or vector expression, owing to the spontaneous cleavage of the RNA transcript. Administration of either oligonucleotides complementary to regions of the self-cleaving motif or a specific small molecule results in the efficient induction of gene expression, owing to inhibition of self-cleavage of the messenger RNA. Efficient regulation of transgene expression is shown in a variety of mammalian cell lines and live animals. In conjunction with other emerging technologies, this methodology may be particularly applicable to the development of gene regulation systems tailored to any small inducer molecule, and provide a novel means of biological sensing in vivo that may have an important application in the regulated delivery of protein therapeutics.