Verticillium wilt caused by soilborne fungus Verticillium dahliae could significantly reduce cotton yield. Here, we cloned a tomato Ve homologous gene, Gbve1, from an island cotton cultivar that is resistant to Verticillium wilt. We found that the Gbve1 gene was induced by V. dahliae and by phytohormones salicylic acid, jasmonic acid, and ethylene, but not by abscisic acid. The induction of Gbve1 in resistant cotton was quicker and stronger than in Verticillium-susceptible upland cotton following V. dahliae inoculation. Gbve1 promoter-driving GUS activity was found exclusively in the vascular bundles of roots and stems of transgenic Arabidopsis. Virus-induced silencing of endogenous genes in resistant cotton via targeting a fragment of the Gbve1 gene compromised cotton resistance to V. dahliae. Furthermore, we transformed the Gbve1 gene into Arabidopsis and upland cotton through Agrobacterium-mediated transformation. Overexpression of the Gbve1 gene endowed transgenic Arabidopsis and upland cotton with resistance to high aggressive defoliating and non-defoliating isolates of V. dahliae. And HR-mimic cell death was observed in the transgenic Arabidopsis. Our results demonstrate that the Gbve1 gene is responsible for resistance to V. dahliae in island cotton and can be used for breeding cotton varieties that are resistant to Verticillium wilt.