The conventional notions of pseudogenes being ‘junk DNA’ have largely been offset as research studies have established their role in multiple biological processes. Our studies towards identification of genetic modulators employing C. elegans model, that associate reproductive health and age-related neurodegenerative diseases, led us to identification and functional characterization of a pseudogene T04B2.1, which when knocked out,exacerbates the aggregation of α-Synuclein and β-Amyloid proteins, induces lipid deposition and alters morphometric endpoints in worms. Whole transcriptome analysis of worms under knockdown condition of T04B2.1 revealed an altered expression of 187 sequences, most of these being non-coding RNAs, miRNAs and piRNAs modulating the RNAi regulatory processes. Our gene ontology and pathway enrichment analysis demonstrated the role of T04B2.1 in protein quality control, metabolic pathways and development. We further performed a signature motif search and successfully identified a common motif that is present between all piRNA and miRNA molecules, which are significantly altered upon T04B2.1 silencing. This study unveils the non-conventional regulatory role of pseudogene T04B2.1with respect to effects associated with neurodegenerative diseases and encourages further studies to decipher the regulatory mechanism governed by pseudogenes.