The 120-nt long 5S rRNA, is an indispensable component of cytoplasmic ribosomes in all living organisms. The functions of 5S rRNA and the reasons for its evolutionary preservation as an independent molecule remain unclear. Here we used ribosome engineering to investigate whether maintaining 5S rRNA as an independent molecule is critical for ribosome function and cell survival. By fusing circularly permutated 5S rRNA (cp5S) with 23S rRNA and deleting all wild type 5S rRNA genes, we generated an Escherichia coli strain completely devoid of free 5S rRNA. Viability of the engineered cells demonstrates that autonomous 5S rRNA is not required for cell growth at 37°C and is unlikely to have essential functions outside the ribosome. The fully-assembled ribosomes carrying 23S-cp5S hybrid rRNA and lacking free 5S rRNA are highly active in translation. However, the engineered cells accumulate aberrant 50S subunits that are unable to form stable 70S ribosomes. Cryo-EM analysis revealed a dramatically malformed peptidyl transferase center in the misassembled 50S subunits. The results of our experiments argue that the key evolutionary force preserving the autonomous nature of the smallest rRNA is its role in ribosome biogenesis.