MicroRNAs (miRNAs) are small noncoding RNAs that repress protein synthesis by binding to target messenger RNAs. We investigated the effect of target secondary structure on the efficacy of repression by miRNAs. Using structures predicted by the Sfold program, we model the interaction between an miRNA and a target as a two-step hybridization reaction: nucleation at an accessible target site followed by hybrid elongation to disrupt local target secondary structure and form the complete miRNA-target duplex. This model accurately accounts for the sensitivity to repression by let-7 of various mutant forms of the Caenorhabditis elegans lin-41 3' untranslated region and for other experimentally tested miRNA-target interactions in C. elegans and Drosophila melanogaster. These findings indicate a potent effect of target structure on target recognition by miRNAs and establish a structure-based framework for genome-wide identification of animal miRNA targets.