MicroRNA (miRNA) biogenesis is finely controlled by complex layers of post-transcriptional regulators, including RNA-binding proteins (RBPs). Here, we show that an RBP, QKI5, activates the processing of primary miR-124-1 (pri-124-1) during erythropoiesis. QKI5 recognizes a distal QKI response element and recruits Microprocessor through interaction with DGCR8. Furthermore, the recruited Microprocessor is brought to pri-124-1 stem loops by a spatial RNA-RNA interaction between two complementary sequences. Thus, mutations disrupting their base-pairing affect the strength of QKI5 activation. When erythropoiesis proceeds, the concomitant decrease of QKI5 releases Microprocessor from pri-124-1 and reduces mature miR-124 levels to facilitate erythrocyte maturation. Mechanistically, miR-124 targets TAL1 and c-MYB, two transcription factors involved in normal erythropoiesis. Importantly, this QKI5-mediated regulation also gives rise to a unique miRNA signature, which is required for erythroid differentiation. Taken together, these results demonstrate the pivotal role of QKI5 in primary miRNA processing during erythropoiesis and provide new insights into how a distal element on primary transcripts affects miRNA biogenesis.