Final answer:
The RNase domain on IRE1 cleaves XBP1 mRNA as a part of the Unfolded Protein Response to help restore normal cell function when misfolded proteins accumulate.
Step-by-step explanation:
The function of the RNase domain on IRE1 is to cleave XBP1 mRNA. This is a critical process in the Unfolded Protein Response (UPR) pathway within the cell. When misfolded proteins accumulate in the endoplasmic reticulum (ER), IRE1 is activated and the RNase domain cleaves a specific intron from the XBP1 mRNA. This cleavage event is unconventional, as it does not occur at the standard splice sites, and results in a frame-shift that produces a potent transcription factor, XBP1s, which can then go on to upregulate UPR target genes that help to restore normal function to the cell.