Three of the four eukaryotic ribosomal RNA molecules (18S, 5.8S and 25-28S) are synthesized as a single precursor which is subsequently processed into the mature rRNAs by a complex series of cleavage and modification reactions. In the yeast Saccharomyces cerevisiae, the early pre-rRNA cleavages at sites A0, A1 and A2, required for the synthesis of 18S rRNA, are inhibited in strains lacking RNA or protein components of the U3, U14, snR10 and snR30 small nucleolar ribonucleoproteins (snoRNPs). The subsequent cleavage at site A3, required for formation of the major, short form of 5.8S rRNA, is carried out by another ribonucleoprotein, RNase MRP. A screen for mutations showing synthetic lethality with deletion of the non-essential snoRNA, snR10, identified a novel gene, RRP5, which is essential for viability and encodes a 193 kDa nucleolar protein. Genetic depletion of Rrp5p inhibits the synthesis of 18S rRNA and, unexpectedly, also of the major short form of 5.8S rRNA. Pre-rRNA processing is concomitantly impaired at sites A0, A1, A2 and A3. This distinctive phenotype makes Rrp5p the first cellular component simultaneously required for the snoRNP-dependent cleavage at sites A0, A1 and A2 and the RNase MRP-dependent cleavage at A3 and provides evidence for a close interconnection between these processing events. Putative RRP5 homologues from Caenorhabditis elegans and humans were also identified, suggesting that the critical function of Rrp5p is evolutionarily conserved.