Adaptation to external environmental challenges at the cellular level requires rapid responses and involves relay of information to the nucleus to drive key gene expression changes through downstream transcription factors. Here, we describe an alternative route of adaptation through a direct role for cellular signaling components in governing gene expression via RNA interference-mediated small RNA production. Calcium-calcineurin signaling is a highly conserved signaling cascade that plays central roles in stress adaptation and virulence of eukaryotic pathogens, including the human fungal pathogenCryptococcus neoformans. Upon activation inC. neoformans, calcineurin localizes to P-bodies, membrane-less organelles that are also the site for RNA processing. Here, we studied the role of calcineurin and its substrates in RNAi-mediated transgene silencing. Our results reveal that calcineurin regulates both the onset and the reversion of transgene silencing. We found that some calcineurin substrates that localize to P-bodies also regulate transgene silencing but in opposing directions. Small RNA sequencing in mutants lacking calcineurin or its targets revealed a role for calcineurin in small RNA production. Interestingly, the impact of calcineurin and its substrates was found to be different in genome-wide analysis, suggesting that calcineurin may regulate small RNA production inC. neoformansthrough additional pathways. Overall, these findings define a mechanism by which signaling machinery induced by external stimuli can directly alter gene expression to accelerate adaptative responses and contribute to genome defense.