RNA interference (RNAi) utilizes small interfering RNAs (siRNAs) to direct silencing of specific genes through transcriptional and post-transcriptional mechanisms. The siRNA guides can originate from exogenous (exo-RNAi) or natural endogenous (endo-RNAi) sources of double-stranded RNA (dsRNA). In Caenorhabditis elegans, inactivation of genes that function in the endo-RNAi pathway can result in enhanced silencing of genes targeted by siRNAs from exogenous sources, indicating cross-regulation between the pathways. Here we show that members of another small RNA pathway, the mir-35-41 cluster of microRNAs (miRNAs) can regulate RNAi. In worms lacking miR-35-41, there is reduced expression of lin-35/Rb, the C. elegans homolog of the tumor suppressor Retinoblastoma gene, previously shown to regulate RNAi responsiveness. Genome-wide microarray analyses show that targets of endo-siRNAs are up-regulated in mir-35-41 mutants, a phenotype also displayed by lin-35/Rb mutants. Furthermore, overexpression of lin-35/Rb specifically rescues the RNAi hypersensitivity of mir-35-41 mutants. Although the mir-35-41 miRNAs appear to be exclusively expressed in germline and embryos, their effect on RNAi sensitivity is transmitted to multiple tissues and stages of development. Additionally, we demonstrate that maternal contribution of miR-35-41 or lin-35/Rb is sufficient to reduce RNAi effectiveness in progeny worms. Our results reveal that miRNAs can broadly regulate other small RNA pathways and, thus, have far reaching effects on gene expression beyond directly targeting specific mRNAs.