MicroRNAs (miRNAs) are short RNAs that direct messenger RNA degradation or disrupt mRNA translation in a sequence-dependent manner. For more than a decade, attempts to study the interaction of miRNAs with their targets were confined to the 3′ untranslated regions of mRNAs, fuelling an underlying assumption that these regions are the principal recipients of miRNA activity. Here we focus on the mouse Nanog, Oct4 (also known as Pou5f1) and Sox2 genes and demonstrate the existence of many naturally occurring miRNA targets in their amino acid coding sequence (CDS). Some of the mouse targets analysed do not contain the miRNA seed, whereas others span exon-exon junctions or are not conserved in the human and rhesus genomes. miR-134, miR-296 and miR-470, upregulated on retinoic-acid-induced differentiation of mouse embryonic stem cells, target the CDS of each transcription factor in various combinations, leading to transcriptional and morphological changes characteristic of differentiating mouse embryonic stem cells, and resulting in a new phenotype. Silent mutations at the predicted targets abolish miRNA activity, prevent the downregulation of the corresponding genes and delay the induced phenotype. Our findings demonstrate the abundance of CDS-located miRNA targets, some of which can be species-specific, and support an augmented model whereby animal miRNAs exercise their control on mRNAs through targets that can reside beyond the 3′ untranslated region.