Bioactive molecules can pass between microbiota and host to influence host cellular functions. However, general principles of interspecies communication have not been discovered. We show here in C. elegans that nitric oxide derived from resident bacteria promotes widespread S-nitrosylation of the host proteome. We further show that microbiota-dependent S-nitrosylation of C. elegans Argonaute protein (ALG-1)-at a site conserved and S-nitrosylated in mammalian Argonaute 2 (AGO2)-alters its function in controlling gene expression via microRNAs. By selectively eliminating nitric oxide generation by the microbiota or S-nitrosylation in ALG-1, we reveal unforeseen effects on host development. Thus, the microbiota can shape the post-translational landscape of the host proteome to regulate microRNA activity, gene expression, and host development. Our findings suggest a general mechanism by which the microbiota may control host cellular functions, as well as a new role for gasotransmitters.