Endogenous small RNAs, including microRNAs (miRNAs) and short interfering RNAs (siRNAs), are critical components of plant gene regulation. Some abundant miRNAs involved in developmental control are conserved between anciently diverged plants, while many other less-abundant miRNAs appear to have recently emerged in the Arabidopsis thaliana lineage. Using large-scale sequencing of small RNAs, we extended the known diversity of miRNAs in basal plants to include 88 confidently annotated miRNA families in the moss Physcomitrella patens and 44 in the lycopod Selaginella moellendorffii. Cleavage of 29 targets directed by 14 distinct P. patens miRNA families and a trans-acting siRNA (ta-siRNA) was experimentally confirmed. Despite a core set of 12 miRNA families also expressed in angiosperms, weakly expressed and apparently lineage-specific miRNAs accounted for the majority of miRNA diversity in both species. Nevertheless, the molecular functions of several of these lineage-specific small RNAs matched those of angiosperms, despite dissimilarities in the small RNA sequences themselves, including small RNAs that mediated negative feedback regulation of the miRNA pathway and miR390-dependent ta-siRNAs that guided the cleavage of AUXIN RESPONSE FACTOR mRNAs. Diverse, lineage-specific, small RNAs can therefore perform common biological functions in plants.