In vitro selection of RNA-cleaving DNAzymes was performed using three heavy lanthanide ions (Ln(3+)): Ho(3+), Er(3+) and Tm(3+). The resulting sequences were aligned together and about half of the library contained a new family of DNAzyme. These DNAzymes have a simple loop structure, and they are active only with the seven heavy Ln(3+). Among the tested non-lanthanide ions, only Y(3+) induced cleavage and even Pb(2+) failed to cleave, suggesting a very high specificity. A representative DNAzyme, Tm7, has a sigmoidal metal binding curve with a Hill coefficient of 3, indicating that three metal ions are involved in the catalytic step. Its pH-rate profile has a slope of 1, suggesting a single deprotonation step is involved in the rate-limiting step. Tm7 has a cleavage rate of 1.6 min(-1) at pH 7.8 with 10 μM Er(3+). Phosphorothioate substitution at the cleavage junction completely inhibits the activity, which cannot be rescued by Cd(2+) alone, or by a mixture of Er(3+) and Cd(2+), suggesting that two interacting metal ions are involved in direct bonding to both non-bridging oxygen atoms. A new model involving three lanthanide ions is proposed based on this study. A biosensor is engineered using Tm7 to detect Dy(3+) down to 14 nM.