Aberrant miR-21 expression is closely associated with cell proliferation, anti-apoptosis, migration, invasion, and metastasis in various cancers. However, the regulatory mechanism of miR-21 biogenesis is largely unknown. Here, we demonstrated that the tumor suppressor PTEN negatively regulates the expression of oncogenic miR-21 at the post-transcriptional level. Moreover, our results suggest that PTEN plays such a role through the indirect interaction with the Drosha complex. To elucidate how PTEN regulates pri- to pre-miR-21 processing, we attempted to find PTEN-interacting proteins and identified an RNA-regulatory protein, RNH1. Using the sensor to monitor pri-miR-21 processing, we demonstrated that RNH1 is necessary and sufficient for pri-miR-21 processing. Moreover, our results propose that the nuclear localization of RNH1 is important for this function. Further analysis showed that RNH1 directly interacts with the Drosha complex and that PTEN blocks this interaction. Taken together, these results suggest that the PTEN-mediated miR-21 regulation is achieved by inhibiting the interaction between the Drosha complex and RNH1, revealing previously unidentified role of PTEN in the oncogenic miR-21 biogenesis.