how to change hostname

Hi

I am having trouble setting my hostame.  I have redhat 7.1.  I manually
edited /etc/hosts to:
127.0.0.1    localhost.localdomain localhost
192.168.0.3    Shitty    Shitty.localdomain

I have also used "hostname Shitty"

But my hostname still shows up at my command prompt as
"localhost.localdomain.

What am I doing wrong here. How to I properly set my hostname?

Thx