In eukaryotes, 18S, 5.8S, and 28S rRNAs are transcribed as precursor molecules that undergo extensive modification and nucleolytic processing to form the mature rRNA species. Central in the process are the small nucleolar RNAs (snoRNAs). The majority of snoRNAs guide site specific chemical modifications but a few are involved in defining pre-rRNA cleavages. Here, we describe an unusual snoRNA (TtnuCD32) belonging to the box C/D subgroup from the ciliate Tetrahymena thermophila. We show that TtnuCD32 is unlikely to function as a modification guide snoRNA and that it is critical for cell viability. Cell lines with genetic knock-down of TtnuCD32 were impaired in growth and displayed two novel and apparently unrelated phenotypes. The most prominent phenotype is the accumulation of processing intermediates of 5.8S rRNA. The second phenotype is the decrease in abundance of a ~100 nt 26S rRNA fragment of unknown function. Sequence analysis demonstrated that TtnuCD32 share features with the essential snoRNA U14 but an alternative candidate (TtnuCD25) was more closely related to other U14 sequences. This, together with the fact that the observed rRNA processing phenotypes were not similar to what has been observed in U14 depleted cells, suggests that TtnuCD32 is a U14 homolog that has gained novel functions.