The Gram-negative bacterium Stenotrophomonas maltophilia G2 was isolated from a soil sample and was found to have high nematotoxic activity against a free-living nematode, Panagrellus redivivus, and a plant-parasitic nematode, Bursaphelenchus xylophilus. The analysis of virulence factors revealed that although the small molecular metabolites participated in nematode killing, the crude extracellular protein extract from the bacterial culture supernatant contributed significantly to its nematocidal activity. An extracellular protease was purified by chromatography, and its effects on degrading purified nematode cuticle and killing living nematodes were confirmed experimentally. Characterization of this purified protease revealed that the application of phenylmethylsulphonyl fluoride, an inhibitor of serine proteases, could completely abolish its proteolytic activity. The results from N-terminal amino acid sequencing showed no similarity with any known serine protease in S. maltophilia, suggesting a novel virulence serine protease was obtained. Our study is the first to show the nematocidal activity of S. maltophilia, and we identified a novel serine protease as an important pathogenicity factor.