PIWI-interacting (pi)RNAs are small silencing RNAs that are crucial for the defense against transposable elements in germline tissues of animals. In Aedes aegypti mosquitoes, the piRNA pathway also contributes to gene regulation in somatic tissues, illustrating additional roles for piRNAs and PIWI proteins besides transposon repression. Here, we identify a highly abundant endogenous piRNA (propiR1) that associates with both Piwi4 and Piwi5. PropiR1-mediated target silencing requires base-pairing in the seed region with supplemental base-pairing at the piRNA 3′ end. Yet, propiR1 represses a limited set of targets, among which is the lncRNA AAEL027353 (lnc027353). Slicing of lnc027353 initiates production of responder and trailer piRNAs from the cleavage fragment. Expression of propiR1 commences early during embryonic development and mediates degradation of maternally provided lnc027353. Both propiR1 and its lncRNA target are conserved in the closely related Aedes albopictus mosquito, underscoring the importance of this regulatory network for mosquito development.