Asparagine (N)-linked glycosylation regulates numerous cellular activities, such as glycoprotein quality control, intracellular trafficking, and cell-cell communications. In eukaryotes, the glycosylation reaction is catalyzed by oligosaccharyltransferase (OST), a multimembrane protein complex that is localized in the endoplasmic reticulum (ER). During N-glycosylation in the ER, the protein-unbound form of oligosaccharides (free oligosaccharides; fOSs), which is structurally related to N-glycan, is released into the ER lumen. However, the enzyme responsible for this process remains unidentified. Here, we demonstrate that eukaryotic OST generates fOSs. Biochemical and genetic analyses using mutant strains of Saccharomyces cerevisiae revealed that the generation of fOSs is tightly correlated with the N-glycosylation activity of OST. Furthermore, we present evidence that the purified OST complex can generate fOSs by hydrolyzing dolichol-linked oligosaccharide, the glycan donor substrate for N-glycosylation. The heterologous expression of a single subunit of OST from the protozoan Leishmania major in S. cerevisiae demonstrated that this enzyme functions both in N-glycosylation and generation of fOSs. This study provides insight into the mechanism of PNGase-independent formation of fOSs.