All organisms sense and respond to conditions that stress their homeostatic mechanisms. Here we review current studies showing that the nucleolus, long regarded as a mere ribosome producing factory, plays a key role in monitoring and responding to cellular stress. After exposure to extra- or intracellular stress, cells rapidly down-regulate the synthesis of ribosomal RNA. Impairment of nucleolar function in response to stress is accompanied by perturbation of nucleolar structure, cell cycle arrest and stabilization of p53. The nucleolar target for down-regulation of rDNA transcription is TIF-IA, an essential transcription factor that modulates the activity of RNA polymerase I (Pol I). Upon stress, TIF-IA is phosphorylated by c-Jun N-terminal kinase 2 (JNK2). Phosphorylation prevents TIF-IA from interaction with Pol I, thereby impairing transcription complex formation and rRNA synthesis. Furthermore, stress-induced inactivation of TIF-IA is accompanied by translocation of TIF-IA from the nucleolus to the nucleoplasm. These findings, together with other data showing stress-induced release of nucleolar proteins to carry out other regulatory functions, reinforce the growing realization that nucleoli orchestrate the chain of events the cell uses to properly respond to stress signals.