The multisubunit eukaryotic exosome is an essential RNA processing and degradation machine. In its nuclear form, the exosome associates with the auxiliary factor Rrp6p, which participates in both RNA processing and degradation reactions. The crystal structure of Saccharomyces cerevisiae Rrp6p displays a conserved RNase D core with a flanking HRDC (helicase and RNase D C-terminal) domain in an unusual conformation shown to be important for the processing function of the enzyme. Complexes with AMP and UMP, the products of the RNA degradation process, reveal how the protein specifically recognizes ribonucleotides and their bases. Finally, in vivo mutational studies show the importance of the domain contacts for the processing function of Rrp6p and highlight fundamental differences between the protein and its prokaryotic RNase D counterparts.