We present a novel Phi29 DNA polymerase application in RCA-based target RNA detection and analysis. The 3'-->5' RNase activity of Phi29 DNA polymerase converts target RNA into a primer and the polymerase uses this newly generated primer for RCA initiation. Therefore, using target RNA-primed RCA, padlock probes may be targeted to inner RNA sequences and their peculiarities can be analyzed directly. We demonstrate that the exoribonucleolytic activity of Phi29 DNA polymerase can be successfully applied in vitro and in situ. These findings expand the potential for detection and analysis of RNA sequences distanced from 3'-end.