Transposable elements are viewed as ‘selfish genetic elements’, yet they contribute to gene regulation and genome evolution in diverse ways1. More than half of the human genome consists of transposable elements2.Aluelements belong to the short interspersed nuclear element (SINE) family of repetitive elements, and with over 1 million insertions they make up more than 10% of the human genome2. Despite their abundance and the potential evolutionary advantages they confer,Aluelements can be mutagenic to the host as they can act as splice acceptors, inhibit translation of mRNAs and cause genomic instability3.Aluelements are the main targets of the RNA-editing enzyme ADAR4and the formation ofAluexons is suppressed by the nuclear ribonucleoprotein HNRNPC5, but the broad effect of massive secondary structures formed by inverted-repeatAluelements on RNA processing in the nucleus remains unknown. Here we show that DHX9, an abundant6nuclear RNA helicase7, binds specifically to inverted-repeatAluelements that are transcribed as parts of genes. Loss of DHX9 leads to an increase in the number of circular-RNA-producing genes and amount of circular RNAs, translational repression of reporters containing inverted-repeatAluelements, and transcriptional rewiring (the creation of mostly nonsensical novel connections between exons) of susceptible loci. Biochemical purifications of DHX9 identify the interferon-inducible isoform of ADAR (p150), but not the constitutively expressed ADAR isoform (p110), as an RNA-independent interaction partner. Co-depletion of ADAR and DHX9 augments the double-stranded RNA accumulation defects, leading to increased circular RNA production, revealing a functional link between these two enzymes. Our work uncovers an evolutionarily conserved function of DHX9. We propose that it acts as a nuclear RNA resolvase that neutralizes the immediate threat posed by transposon insertions and allows these elements to evolve as tools for the post-transcriptional regulation of gene expression.