In metazoans, Piwi-related Argonaute proteins engage piRNAs (Piwi-interacting small RNAs) to defend the genome against invasive nucleic acids, such as transposable elements. Yet many organisms—including worms and humans—express thousands of piRNAs that do not target transposons, suggesting that piRNA function extends beyond genome defense. Here, we show that the X chromosome-derived piRNA 21ux-1 downregulates XOL-1 (XO Lethal), a master regulator of X chromosome dosage compensation and sex determination in Caenorhabditis elegans. Mutations in 21ux-1 and several Piwi-pathway components sensitize hermaphrodites to dosage compensation and sex determination defects. We show that the piRNA pathway also targets xol-1 in C. briggsae, a nematode species related to C. elegans. Our findings reveal physiologically important piRNA-mRNA interactions, raising the possibility that piRNAs function broadly to ensure robust gene expression and germline development. Display omitted •An X-linked piRNA, 21ux-1, targets xol-1 and represses its expression in C. elegans•21ux-1 acts with sex-1 to promote dosage compensation and sex determination•The piRNA pathway regulates the expression of the xol-1 ortholog in C. briggsae Although piRNAs are known to defend the genome against transposons, it remains unclear whether they have additional functions beyond genome defense. Tang et al. show that an X chromosome-derived piRNA downregulates XOL-1 expression to promote robust regulation of dosage compensation and sex determination in C. elegans.