PIWI proteins use guide piRNAs to repress selfish genomic elements, protecting the genomic integrity of gametes and ensuring the fertility of animal species. Efficient transposon repression depends on amplification of piRNA guides in the ping-pong cycle, which in Drosophila entails tight cooperation between two PIWI proteins, Aub and Ago3. Here we show that post-translational modification, symmetric dimethylarginine (sDMA), of Aub is essential for piRNA biogenesis, transposon silencing and fertility. Methylation is triggered by loading of a piRNA guide into Aub, which exposes its unstructured N-terminal region to the PRMT5 methylosome complex. Thus, sDMA modification is a signal that Aub is loaded with piRNA guide. Amplification of piRNA in the ping-pong cycle requires assembly of a tertiary complex scaffolded by Krimper, which simultaneously binds the N-terminal regions of Aub and Ago3. To promote generation of new piRNA, Krimper uses its two Tudor domains to bind Aub and Ago3 in opposite modification and piRNA-loading states. Our results reveal that post-translational modifications in unstructured regions of PIWI proteins and their binding by Tudor domains that are capable of discriminating between modification states is essential for piRNA biogenesis and silencing.