MicroRNAs (miRNAs) are endogenously produced approximately 21-nt riboregulators that associate with Argonaute (Ago) proteins to direct mRNA cleavage or repress the translation of complementary RNAs. Capturing the molecular mechanisms of miRNA interacting with its target will not only reinforce the understanding of underlying RNA interference but also fuel the design of more effective small-interfering RNA strands. To address this, in the present work the RNA-bound (Ago-miRNA, Ago-miRNA-target) and RNA-free Ago forms were analyzed by performing both molecular dynamics simulations and thermodynamic analysis. Based on the principal component analysis results of the simulation trajectories as well as the correlation analysis in fluctuations of residues, we discover that: 1) three important (PAZ, Mid and PIWI) domains exist in Argonaute which define the global dynamics of the protein, 2) the interdomain correlated movements are so crucial for the interaction of Ago-RNAs that they not only facilitate the relaxation of the interactions between residues surrounding the RNA binding channel but also induce certain conformational changes, and 3) it is just these conformational changes that expand the cavity of the active site and open putative pathways for both the substrate uptake and product release. In addition, by thermodynamic analysis we also discover that for both the guide RNA 5-end recognition and the facilitated site-specific cleavage of the target, the presence of two metal ions (of Mg(2+)) plays a predominant role, and this conclusion is consistent with the observed enzyme catalytic cleavage activity in the ternary complex (Ago-miRNA-mRNA). Our results find that it is the set of arginine amino acids concentrated in the nucleotide-binding channel in Ago, instead of the conventionally-deemed seed base-paring, that makes greater contributions in stabilizing the binding of the nucleic acids to Ago.