Ribozymes are catalytic RNAs with diverse functions including self-splicing and polymerization. This work aims to discover natural ribozymes that behave as hydrolytic and sequence-specific DNA endonucleases, which could be repurposed as DNA manipulation tools. Focused on bacterial group II-C introns, we found that many systems without intron-encoded protein propagate multiple copies in their resident genomes. These introns, named HYdrolytic Endonucleolytic Ribozymes (HYERs), cleaved RNA, single-stranded DNA, bubbled double-stranded DNA (dsDNA), and plasmids in vitro. HYER1 generated dsDNA breaks in the mammalian genome. Cryo-electron microscopy analysis revealed a homodimer structure for HYER1, where each monomer contains a Mg2+-dependent hydrolysis pocket and captures DNA complementary to the target recognition site (TRS). Rational designs including TRS extension, recruiting sequence insertion, and heterodimerization yielded engineered HYERs showing improved specificity and flexibility for DNA manipulation.