The first step in microRNA (miRNA) biogenesis usually involves cleavage at the base of its fold-back precursor. Here, we describe a non-canonical processing mechanism for miRNAs miR319 and miR159 in Arabidopsis thaliana. We found that their biogenesis begins with the cleavage of the loop, instead of the usual cut at the base of the stem-loop structure. DICER-LIKE 1 (DCL1) proceeds then with three additional cuts until the mature miRNA is released. We further show that the conserved upper stem of the miR319 precursor is essential to organize its biogenesis, whereas sequences below the miRNA/miRNA(*) region are dispensable. In addition, the bulges present in the fold-back structure reduce the accumulation of small RNAs other than the miRNA. The biogenesis of miR319 is conserved in the moss Physcomitrella patens, showing that this processing mechanism is ancient. These results provide new insights into the plasticity of small-RNA pathways.