Post-transcriptional gene silencing (PTGS) is a sequence-specific RNA degradation mechanism that is widespread in eukaryotic organisms. It is often associated with methylation of the transcribed region of the silenced gene and with accumulation of small RNAs (21 to 25 nucleotides) homologous to the silenced gene. In plants, PTGS can be triggered locally and then spread throughout the organism via a mobile signal that can cross a graft junction. Previously, we showed that the helper component-proteinase (HC-Pro) of plant potyviruses suppresses PTGS. Here, we report that plants in which PTGS has been suppressed by HC-Pro fail to accumulate the small RNAs associated with silencing. However, the transgene locus of these plants remains methylated. Grafting experiments indicate that HC-Pro prevents the plant from responding to the mobile silencing signal but does not eliminate its ability to produce or send the signal. These results demonstrate that HC-Pro functions downstream of transgene methylation and the mobile signal at a step preceding accumulation of the small RNAs.