Here we report a unique processing pathway in Escherichia coli for tRNA(Leu5) in which the exoribonuclease polynucleotide phosphorylase (PNPase) removes the Rho-independent transcription terminator from the leuX transcript without requiring the RhlB RNA helicase. Our data demonstrate for the first time that PNPase can efficiently degrade an RNA substrate containing secondary structures in vivo. Furthermore, RNase P, an endoribonuclease that normally generates the mature 5'-ends of tRNAs, removes the leuX terminator inefficiently independent of PNPase activity. RNase P cleaves 4-7 nt downstream of the CCA determinant generating a substrate for RNase II, which removes an additional 3-4 nt. Subsequently, RNase T completes the 3' maturation process by removing the remaining 1-3 nt downstream of the CCA determinant. RNase E, G and Z are not involved in terminator removal. These results provide further evidence that the E. coli tRNA processing machinery is far more diverse than previously envisioned.