Pseudoknots are common structural motifs found in RNA.  They are formed by two nested stem-loops such that the stem of one structure is formed from the loop of the other.  There are multiple folding topologies among pseudoknots and great variation in loop lengths, making them a structurally diverse group.
Inverted repeats are a key component of pseudoknots as can be seen in the illustration of a naturally occurring pseudoknot found in the human telomerase RNA component. Four different sets of inverted repeats are involved in this structure.  Sets 1 and 2 are the stem of stem-loop A and are part of the loop for stem-loop B.  Similarly, sets 3 and 4 are the stem for stem-loop B and are part of the loop for stem-loop A.
Pseudoknots play a number of different roles in biology.  The telomerase pseudoknot in the illustration is critical to that enzymes activity.  The ribozyme for the hepatitis delta virus (HDV)' folds into a double-pseudoknot structure and self-cleaves its circular genome to produce a single-genome-length RNA.  Pseudoknots also play a role in programmed ribosomal frameshifting found in some viruses and required in the replication of retroviruses.