Faithful inheritance of mitochondrial DNA (mtDNA) is crucial for cellular respiration/oxidative phosphorylation and mitochondrial membrane potential. However, how mtDNA is transmitted to progeny is not fully understood. We utilized hypersuppressive mtDNA, a class of respiratory deficient Saccharomyces cerevisiae mtDNA that is preferentially inherited over wild-type mtDNA (rho+), to uncover the factors governing mtDNA inheritance. We found that some regions of rho+ mtDNA persisted while others were lost after a specific hypersuppressive takeover indicating that hypersuppressive preferential inheritance may partially be due to active destruction of rho+ mtDNA. From a multicopy suppression screen, we found that overexpression of putative mitochondrial RNA exonuclease PET127 reduced biased inheritance of a subset of hypersuppressive genomes. This suppression required PET127 binding to the mitochondrial RNA polymerase RPO41 but not PET127 exonuclease activity. A temperature-sensitive allele of RPO41 improved rho+ mtDNA inheritance over a specific hypersuppressive mtDNA at semi-permissive temperatures revealing a previously unknown role for rho+ transcription in promoting hypersuppressive mtDNA inheritance.