The ciliate Oxytricha is a microbial eukaryote with two genomes, one of which experiences extensive genome remodeling during development. Each round of conjugation initiates a cascade of events that construct a transcriptionally active somatic genome from a scrambled germline genome, with considerable help from both long and small noncoding RNAs. This process of genome remodeling entails massive DNA deletion and reshuffling of remaining DNA segments to form functional genes from their interrupted and scrambled germline precursors. The use of Oxytricha as a model system provides an opportunity to study an exaggerated form of programmed genome rearrangement. Furthermore, studying the mechanisms that maintain nuclear dimorphism and mediate genome rearrangement has demonstrated a surprising plasticity and diversity of noncoding RNA pathways, with new roles that go beyond conventional gene silencing. Another aspect of ciliate genetics is their unorthodox patterns of RNA-mediated, epigenetic inheritance that rival Mendelian inheritance. This review takes the reader through the key experiments in a model eukaryote that led to fundamental discoveries in RNA biology and pushes the biological limits of DNA processing.