RNA interference (RNAi) potently and specifically induces gene knockdown, and its potential for reverse genetics in Caenorhabditis elegans is enormous. However, even in these nematodes, RNAi can be induced more effectively via enhanced RNAi (Eri) mutant backgrounds. With advances in small RNA sequencing, evidence has suggested that the eri pathway plays an endogenous gene regulatory role, which competes with experimentally introduced RNAi triggers for limiting resources. However, the nature, cellular location, and physiological consequences of this small RNA pathways competition remain unclear. To answer these questions, I first fully characterized the genetic phenotypes of all known Eri mutants. I discovered that different components of the eri pathway have subtle differences upon mutation, which affects more than exogenous RNAi. I then attempted to screen for novel enhanced RNAi mutants, guided by hypothetical mechanisms or tissues of expression not associated with known mutants. After these attempts, I fully characterized the genetic mechanisms that account for enhanced RNAi. Surprisingly, I discovered that the nuclear Argonaute nrde-3 and the peri-nuclear P-granule component pgl-1 are necessary and sufficient for an Eri response. Finally, I examined the impact of the competition among microRNA, endogenous siRNA, and exogenous RNAi pathways. I discovered that C. elegans develops slower upon perturbations to its normal flux of small RNA pathways. Insights from these phenotypes and genetic mechanisms shed light on the importance of small RNA biology and offer a novel suite of tools for sensitizing RNAi in broader contexts, especially given the deep evolutionary conservation of most eri-associated genes.