During starvation and stress, virtually all organisms arrest their protein synthesis and convert their ribosomes into a state of dormancy in which a special class of proteins, known as hibernation factors, protect the ribosome from damage. In bacteria, two major families of hibernation factors have been characterized, but the low conservation of these proteins and the huge diversity of species, habitats and environmental stressors has made the discovery of new dormancy factors challenging. In this study, we identify a new bacterial protein involved in ribosome dormancy. We first characterize dormant ribosomes following cold shock in the psychrophilic bacterium Psychrobacter urativorans using proteomics and cryo-EM. We show that during cold shock, ribosomes in this organism associate with a previously uncharacterized protein that occupies ribosomal active centres and multiple drug-binding sites. Our structure reveals that this new factor, which we term Balon, bears no resemblance to known bacterial hibernation factors. Instead, it belongs to a family of bacterial homologs of the eukaryotic translation factor aeRF1. We identify unique motifs present only in Balon but not its archaeal or eukaryotic counterparts that allow it to engage with the peptidyl transferase center and decoding center of dormant bacterial ribosomes. We then show that, across the bacterial kingdom, Balon-encoding genes are found in nearly 20% of known species and are located in operons involved in different types of stress responses, including osmotic and thermal shock, hypoxia, acid, tRNA damage and antibiotic stress. Taken together, our work shows that bacterial cells possess a functional homolog of eukaryotic translation termination factor, which is likely repurposed into a stress-response protein. This finding illuminates a long-sought evolutionary connection between the bacterial and eukaryotic protein synthesis machinery.