Transgenerational transmission of genome-regulatory epigenetic information can determine phenotypes in the progeny of sexual reproduction. Sequence specificity of transgenerational regulation derives from small RNAs assembled into Piwi-protein complexes. Known targets of transgenerational regulation are primarily transposons and transposon-derived sequences. Here, we extend the scope of Piwi-mediated transgenerational regulation to include unique noncoding RNA loci. Ciliates such as Tetrahymena have a phenotypically silent germline micronucleus and an expressed somatic macronucleus, which is differentiated anew from a germline genome copy in sexual reproduction. We show that the nuclear-localized Tetrahymena Piwi protein Twi8p shuttles from parental to zygotic macronuclei. Genetic elimination of Twi8p has no phenotype for cells in asexual growth. On the other hand, cells lacking Twi8p arrest in sexual reproduction with zygotic nuclei that retain the germline genome structure, without the DNA elimination and fragmentation required to generate a functional macronucleus. Twi8p-bound small RNAs originate from long-noncoding RNAs with a terminal hairpin, which become detectable in the absence of Twi8p. Curiously, the loci that generate Twi8p-bound small RNAs are essential for asexual cell growth, even though Twi8 RNPs are essential only in sexual reproduction. Our findings suggest the model that Twi8 RNPs act on silent germline chromosomes to permit their conversion to expressed macronuclear chromosomes. Overall this work reveals that a Piwi protein carrying small RNAs from long-noncoding RNA loci has transgenerational function in establishing zygotic nucleus competence for gene expression.