Small RNAs regulate spermatogenesis across species ranging from Caenorhabditis elegans to humans. In C. elegans, two Argonaute proteins, ALG-3 and ALG-4, and their associated alg-3/4 26G-small RNAs are essential for spermiogenesis at 25°C. The alg-3/4 26G-small RNAs are antisense to their target mRNAs and produced by the RNA-dependent RNA polymerase, RRF-3. However, it remains unclear how the RNA templates for RRF-3 are generated and which cellular processes are affected by alg-3/4 26G-small RNAs. Here, we demonstrate a previously unidentified zc3h12a-like ribonuclease protein, NYN-3, in alg-3/4 26G-small RNAs biogenesis. NYN-3 is not only required for proper abundance of alg-3/4 26G-small RNAs but also crosslinked to their targeted mRNAs before RRF-3 from ePAR-CLIP-seq. Bioinformatics analysis was then used to parse the 26G-small RNA-targeted genes into functional subclasses. Collectively, these findings implicate NYN-3 as an initiator of alg-3/4 26G-small RNA generation.