Fragile X-associated tremor/ataxia syndrome (FXTAS) is an inherited neurodegenerative disorder caused by the expansion of 55-200 CGG repeats in the 5' UTR of FMR1. These expanded CGG repeats are transcribed and accumulate in nuclear RNA aggregates that sequester one or more RNA-binding proteins, thus impairing their functions. Here, we have identified that the double-stranded RNA-binding protein DGCR8 binds to expanded CGG repeats, resulting in the partial sequestration of DGCR8 and its partner, DROSHA, within CGG RNA aggregates. Consequently, the processing of microRNAs (miRNAs) is reduced, resulting in decreased levels of mature miRNAs in neuronal cells expressing expanded CGG repeats and in brain tissue from patients with FXTAS. Finally, overexpression of DGCR8 rescues the neuronal cell death induced by expression of expanded CGG repeats. These results support a model in which a human neurodegenerative disease originates from the alteration, in trans, of the miRNA-processing machinery.