Method and composition for simultaneously silencing an endogenously transcribed polynucleotide sequence in a cell using RNAi and replacing the function of the endogenous sequence with the function of an exogenous polynucleotide sequence. Also provided are methods of treatment based on the above method, and pharmaceutical composition comprising the vectors of the present invention. Further provided are methods for verifying that silencing or knock-down of a gene in a cell is due to siRNA interference. The method and composition of the present invention takes advantage of the sequence specificity of the RNAi gene silencing or knock down mechanism.