Silencing of a target locus by an unlinked silencing locus can result from transcription inhibition (transcriptional gene silencing; TGS) or mRNA degradation (post-transcriptional gene silencing; PTGS), owing to the production of double-stranded RNA (dsRNA) corresponding to promoter or transcribed sequences, respectively. The involvement of distinct cellular components in each process suggests that dsRNA-induced TGS and PTGS likely result from the diversification of an ancient common mechanism. However, a strict comparison of TGS and PTGS has been difficult to achieve because it generally relies on the analysis of distinct silencing loci. We describe a single transgene locus that triggers both TGS and PTGS, owing to the production of dsRNA corresponding to promoter and transcribed sequences of different target genes. We describe mutants and epigenetic variants derived from this locus and propose a model for the production of dsRNA. Also, we show that PTGS, but not TGS, is graft-transmissible, which together with the sensitivity of PTGS, but not TGS, to RNA viruses that replicate in the cytoplasm, suggest that the nuclear compartmentalization of TGS is responsible for cell-autonomy. In contrast, we contribute local and systemic trafficking of silencing signals and sensitivity to viruses to the cytoplasmic steps of PTGS and to amplification steps that require high levels of target mRNAs.