Genetic and biochemical analysis of RNase Z in eukaryotes, such as Arabadopsis thaliana, and prokaryotes like Bacillus subtilis have demonstrated that this endoribonuclease is essential for the maturation of tRNA precursors that do not contain a chromosomally encoded CCA determinant. As all Escherichia coli tRNA transcripts have chromosomally encoded CCA determinants, the function of its putative RNase Z homologue, the product of the elaC gene, is not clear. Here we demonstrate that the E. coli ElaC protein (RNase Z) endonucleolytically processes B. subtilis tRNA precursors lacking a CCA determinant both in vivo and in vitro. More importantly, E. coli RNase Z plays a significant role in mRNA decay, a previously unidentified activity for the enzyme. The purified RNase Z protein cleaves the rpsT mRNA at locations distinct from those obtained with RNase E. As expected, under physiological conditions E. coli and B. subtilis tRNA precursors containing a CCA determinant are not substrates. These results suggest a potentially important new role for the RNase Z family of proteins in RNA metabolism, particularly in organisms lacking RNase E.