The natural form of the hairpin ribozyme comprises two major structural elements: a four-way RNA junction and two internal loops carried by adjacent arms of the junction. The ribozyme folds into its active conformation by an intimate association between the loops, and the efficiency of this process is greatly enhanced by the presence of the junction. We have used single-molecule spectroscopy to show that the natural form fluctuates among three distinct states: the folded state and two additional, rapidly interconverting states (proximal and distal) that are inherited from the junction. The proximal state juxtaposes the two loop elements, thereby increasing the probability of their interaction and thus accelerating folding by nearly three orders of magnitude and allowing the ribozyme to fold rapidly in physiological conditions. Therefore, the hairpin ribozyme exploits the dynamics of the junction to facilitate the formation of the active site from its other elements. Dynamic interplay between structural elements, as we demonstrate for the hairpin ribozyme, may be a general theme for other functional RNA molecules. R ibozymes, cellular RNA molecules that catalyze chemical reactions, have fundamental implications for the evolution of life on the planet and provide insight into biocatalysis in general (1). Like protein enzymes, they must fold into a conformation that provides a local environment in which catalysis can proceed. Branched helical junctions are very common in RNA and frequently are essential for their function (2), but the dynamic mechanisms by which the junctions contribute to RNA folding are not well understood.The hairpin ribozyme is one of the nucleolytic ribozymes that bring about a site-specific cleavage of the RNA backbone by means of a transesterification reaction in which the 2Ј oxygen attacks the 3Ј phosphorus, thereby breaking the bond to the 5Ј oxygen. The natural form of the hairpin ribozyme comprises two major structural elements: a four-way RNA junction and two internal loops carried by adjacent A and B arms of the junction (Fig. 1a). The loop-loop interaction is essential for the ribozyme activity, generating a 10 5 -fold acceleration of site-specific cleavage or ligation reactions. Although the minimal form without arms C and D can still catalyze the cleavage reaction and has yielded much insight into the catalytic mechanism (3), its folding requires two to three orders of magnitude higher Mg 2ϩ concentration (4-6), and the internal equilibrium between cleavage and ligation is shifted compared with the natural form (7).Ensemble fluorescence resonance energy transfer (FRET) studies have shown that the two loops are brought into close proximity at submillimolar Mg 2ϩ concentrations (4, 8), and extensive contacts between them have been identified from crystallographic analysis (9). The folded ribozyme has the neighboring helical arms coaxially stacked in pairs, A on D and B on C, with an antiparallel orientation of the continuous strands (Fig. 1b). The simple junction generated by replacin...