The C-terminal tails of spliceosomal Sm proteins contain symmetrical dimethylarginine (sDMA) residues in vivo. The precise function of this posttranslational modification in the biogenesis of small nuclear ribonucleoproteins (snRNPs) and pre-mRNA splicing remains largely uncharacterized. Here, we examine the organismal and cellular consequences of loss of symmetric dimethylation of Sm proteins in Drosophila.Genetic disruption of dart5, the fly ortholog of human PRMT5, results in the complete loss of sDMA residues on spliceosomal Sm proteins. Similarly, valois, a previously characterized grandchildless gene, is also required for sDMA modification of Sm proteins. In the absence of dart5, snRNP biogenesis is surprisingly unaffected, and homozygous mutant animals are completely viable. Instead, Dart5 protein is required for maturation of spermatocytes in males and for germ-cell specification in females. Embryos laid by dart5 mutants fail to form pole cells, and Tudor localization is disrupted in stage 10 oocytes. Transgenic expression of Dart5 exclusively within the female germline rescues pole-cell formation, whereas ubiquitous expression rescues sDMA modification of Sm proteins and male sterility.We have shown that Dart5-mediated methylation of Sm proteins is not essential for snRNP biogenesis. The results uncover a novel role for dart5 in specification of the germline and in spermatocyte maturation. Because disruption of both dart5 and valois causes the specific loss of sDMA-modified Sm proteins and studies in C. elegans show that Sm proteins are required for germ-granule localization, we propose that Sm protein methylation is a pivotal event in germ-cell development.