Water-to-land transition is a hallmark of terrestrialization for land plants and requires molecular adaptation to resist water deficiency. Lineages- or species-specific genes are widespread across eukaryotes, and yet the majority of those are functionally unknown and not annotated. Recent studies have revealed that some of such genes could play a role in adapting to environmental stress responses. Here, we identified a novel gene PpBCG1 (Bryophyte Co-retained Gene 1) in the moss Physcomitrium patens that was responsive to dehydration and rehydration. Under de- and rehydration treatments, PpBCG1 was significantly co-expressed with the dehydrin-encoding gene PpDHNA. Microarray data revealed that PpBCG1 was highly expressed in tissues of spores, female organ archegonia, and mature sporophytes. In addition, the Ppbcg1 mutant showed reduced ability of dehydration tolerance, whose plants were accompanied by a relatively low level of chlorophyll content during recovery. Comprehensive transcriptomics uncovered a detailed set of regulatory processes that were affected by the PpBCG1 disruption. Moreover, experimental evidence showed that PpBCG1 might function in the antioxidant activity, abscisic acid (ABA) pathway, and intracellular calcium (Ca2+) homeostasis to resist desiccation. Together, our study provides insights into the roles of one bryophyte co-retained gene in the desiccation tolerance.