Viroid-caused pathogenesis is a specific process dependent on viroid and host genotype(s), and may involve viroid-specific small RNAs (vsRNAs). We describe a new PSTVd variant C3, evolved through sequence adaptation to the host chamomile (Matricaria chamomilla) after biolistic inoculation with PSTVd-KF440-2, which causes extraordinary strong ('lethal') symptoms. The deletion of a single adenine A in the oligoA stretch of the pathogenicity (P) domain appears characteristic of PSTVd-C3. The pathogenicity and the vsRNA pool of PSTVd-C3 were compared to those of lethal variant PSTVd-AS1, from which PSTVd-C3 differs by five mutations located in the P domain. Both lethal viroid variants showed higher stability and lower variation in analyzed vsRNA pools than the mild PSTVd-QFA. PSTVd-C3 and -AS1 caused similar symptoms on chamomile, tomato, and Nicotiana benthamiana, and exhibited similar but species-specific distributions of selected vsRNAs as quantified using TaqMan probes. Both lethal PSTVd variants block biosynthesis of lignin in roots of cultured chamomile and tomato. Four 'expression markers' (TCP3, CIPK, VSF-1, and VPE) were selected from a tomato EST library to quantify their expression upon viroid infection; these markers were strongly downregulated in tomato leaf blades infected by PSTVd-C3- and -AS1 but not by PSTVd-QFA.