Virulence factors of Xanthomonas oryzae pv. oryzicola, the causal agent of bacterial leaf streak in rice, are regulated by a diffusible signal factor (DSF)-dependent quorum-sensing (QS) system. In this study, a novel pathogenicity-related gene, Xoryp_010100018570 (named hshB), of X. oryzae pv. oryzicola was characterized. hshB encodes a hydrolase with a putative signal peptide, which is a homolog of imidazolonepropionase. Bioinformatic analysis showed that hshB is relatively conserved in the genus Xanthomonas but the homologous gene of hshB was not found in X. oryzae pv. oryzae. Reverse-transcription polymerase chain reaction (PCR) analysis showed that hshB and its upstream gene, Xoryp_010100018565 (named hshA), are co-transcribed in X. oryzae pv. oryzicola. Subsequent experimental results indicated that mutation of hshB remarkably impaired the virulence, extracellular protease activity, extracellular polysaccharide production, growth in minimal medium, and resistance to oxidative stress and bismerthiazol of X. oryzae pv. oryzicola. Mutation of clp, encoding a global regulator, resulted in similar phenotypes. Real-time PCR assays showed that hshB transcription is positively regulated by clp and DSF, and induced by poor nutrition. Our study not only found a novel gene hshB regulated by DSF-dependent QS system and clp but also showed that hshB was required for virulence of X. oryzae pv. oryzicola.