Propagation in the cationic ring-opening polymerization of cyclic ethers involves nucleophilic attack of oxygen atoms from the monomer molecules on the cationic growing species (oxonium ions). Such a mechanism is known as the active chain-end mechanism. If hydroxyl groups containing compounds are present in the system, oxygen atoms of HO- groups may compete with cyclic ether oxygen atoms of monomer molecules in reaction with oxonium ions. At the proper conditions, this reaction may dominate, and propagation may proceed by the activated monomer mechanism, that is, by subsequent addition of protonated monomer molecules to HO- terminated macromolecules. Both mechanisms may contribute to the propagation in the cationic polymerization of monomers containing both functions (i.e., cyclic ether group and hydroxyl groups) within the same molecule. In this article, the mechanism of polymerization of three- and four-membered cyclic ethers containing hydroxymethyl substituents is discussed in terms of competition between two possible mechanisms of propagation that governs the structure of the products-branched polyethers containing multiple terminal hydroxymethyl groups.