Homeostatic mechanisms regulate the abundance of several components in small-RNA pathways. We used Drosophila and mammalian systems to demonstrate a conserved homeostatic system in which the status of miRNA biogenesis controls Argonaute protein stability. Clonal analyses of multiple mutants of core Drosophila miRNA factors revealed that stability of the miRNA effector AGO1 is dependent on miRNA biogenesis. Reciprocally, ectopic transcription of miRNAs within in vivo clones induced accumulation of AGO1, as did genetic interference with the ubiquitin-proteasome system. In mouse cells, we found that the stability of Ago2 declined in Dicer-knockout cells and was rescued by proteasome blockade or introduction of either Dicer plasmid or Dicer-independent miRNA constructs. Notably, Dicer-dependent miRNA constructs generated pre-miRNAs that bound Ago2 but did not rescue Ago2 stability. We conclude that Argonaute levels are finely tuned by cellular availability of mature miRNAs and the ubiquitin-proteasome system.