Erh1, the fission yeast homolog of Enhancer of rudimentary, is implicated in meiotic mRNA elimination during vegetative growth, but its function is poorly understood. We show that Erh1 and the RNA-binding protein Mmi1 form a stoichiometric complex, called the Erh1-Mmi1 complex (EMC), to promote meiotic mRNA decay and facultative heterochromatin assembly. To perform these functions, EMC associates with two distinct complexes, Mtl1-Red1 core (MTREC) and CCR4-NOT. Whereas MTREC facilitates assembly of heterochromatin islands coating meiotic genes silenced by the nuclear exosome, CCR4-NOT promotes RNAi-dependent heterochromatin domain (HOOD) formation at EMC-target loci. CCR4-NOT also assembles HOODs at retrotransposons and regulated genes containing cryptic introns. We find that CCR4-NOT facilitates HOOD assembly through its association with the conserved Pir2/ARS2 protein, and also maintains rDNA integrity and silencing by promoting heterochromatin formation. Our results reveal connections among Erh1, CCR4-NOT, Pir2/ARS2, and RNAi, which target heterochromatin to regulate gene expression and protect genome integrity.