Processing of the RNA polymerase I pre-rRNA transcript into the mature 18S, 5.8S, and 25S rRNAs requires removing the “spacer” sequences. The canonical pathway for the removal of the ITS1 spacer, located between 18S and 5.8S rRNAs in the primary transcript, involves cleavages at the 3’ end of 18S rRNA and at two sites inside ITS1. The process generates a long and a short 5.8S rRNA that differ in the number of ITS1 nucleotides retained at the 5.8S 5’ end. Here we document a novel pathway that generates the long 5.8S for ITS1 while bypassing cleavage within ITS1. It entails a single endonuclease cut at the 3’-end of 18S rRNA followed by exonuclease Xrn1 degradation of ITS1. Mutations in RNase MRP increase the accumulation of long relative to short 5.8S rRNA; traditionally this is attributed to a decreased rate of RNase MRP cleavage at its target in ITS1, called A3. In contrast, we report here that the MRP induced switch between long and short 5.8S rRNA formation occurs even when the A3 site is deleted. Based on this and our published data, we propose that the switch may depend on RNase MRP processing RNA molecules other than pre-rRNA.