Small RNA pathways are functionally diverse and have critical roles in maintaining genome organisation and regulating gene expression. Generally, each small RNA pathway is categorised by the Argonaute the small RNAs it associates with, and tissue they perform their function(s) in (soma or germline). In addition to the Argonaute, other proteins are important for the effector complex to function efficiently. One such co-factor is NHL-2, one of five TRIM-NHL family member proteins of C. elegans, originally identified as a miRISC modulator for
let-7 and
lsy-6 targets in the soma. We now show that in addition to the miRNA pathway NHL-2, plays an essential role in the C. elegans germline. In
nhl-2(
ok818) mutants there is an aberrant accumulation of the repressive histone modification (H3K9me2) on germline autosome chromatin, defects in oocyte chromosome organisation and a high level of embryonic lethality. We also found an unexpected role for NHL-2 in the nuclear RNAi pathway, and accompanying temperature-sensitive transgenerational fertility defect. Interestingly, NHL-2 physically associates with DRH-3, CSR-1 and HRDE-1, suggesting it may act in multiple points of small RNA pathways (with DRH-3 of the RdRP complex and with AGO effectors of the RISC). High throughput sequencing of small RNAs in
nhl-2(
ok818) mutants reveals a depletion of 22G-RNAs for a subset of CSR-1 and WAGO target genes. Moreover, alterations in the distribution of 22G-RNAs across CSR-1 target genes suggest a mechanism of NHL-2 action in 22G- RNA biogenesis, and implicate NHL-2 in distinct roles for germline versus somatic small RNA pathways. RNA binding assays demonstrate that NHL-2 is a bona fide RNA binding protein that specifically associates with U-rich sequences. Together, our results show that NHL-2 is a key factor in multiple facets of germline and somatic gene regulation.