A pool of cis-acting hammerhead ribozymes randomized in their substrate recognition sequences was constructed. A variety of active cis-acting ribozymes which had various structures of stems I and III was selected from the pool by in vitro selection. The selected ribozymes were cloned and sequenced. The relationship between the cleavage efficiency and base-pairing in stems I and III of the selected ribozymes was investigated. The ribozymes with the smaller difference in folding energies between the active conformation and the stable but inactive conformation showed a tendency to have the better cleavage efficiency. The optimum length of stem I was 5 or 6 bases while the longer stem III, in general, appeared to be required for efficient cleavage. The specificity of the ribozyme reaction is discussed in terms of the length of stems I and III.