Interaction between the nascent polypeptide chain and the ribosomal exit tunnel can modulate the rate of translation and induce translational arrest to regulate expression of downstream genes. The ribosomal tunnel also provides a protected environment for initial protein folding events. Here, we present a 2.9 Å cryo-electron microscopy structure of a ribosome stalled during translation of the extremely compacted VemP nascent chain. The nascent chain forms two α-helices connected by an α-turn and a loop, enabling a total of 37 amino acids to be observed within the first 50–55 Å of the exit tunnel. The structure reveals how α-helix formation directly within the peptidyltransferase center of the ribosome interferes with aminoacyl-tRNA accommodation, suggesting that during canonical translation, a major role of the exit tunnel is to prevent excessive secondary structure formation that can interfere with the peptidyltransferase activity of the ribosome.