The tangerine pathotype of Alternaria alternata produces the A. citri toxin (ACT) and is the causal agent of citrus brown spot that results in significant yield losses worldwide. Both the production of ACT and the ability to detoxify reactive oxygen species (ROS) are required for A. alternata pathogenicity in citrus. In this study, we report the 34.41 Mb genome sequence of strain Z7 of the tangerine pathotype of A. alternata. The host selective ACT gene cluster in strain Z7 was identified, which included 25 genes with 19 of them not reported previously. Of these, 10 genes were present only in the tangerine pathotype, representing the most likely candidate genes for this pathotype specialization. A transcriptome analysis of the global effects of H2O2 on gene expression revealed 1108 up-regulated and 498 down-regulated genes. Expressions of those genes encoding catalase, peroxiredoxin, thioredoxin and glutathione were highly induced. Genes encoding several protein families including kinases, transcription factors, transporters, cytochrome P450, ubiquitin and heat shock proteins were found associated with adaptation to oxidative stress. Our data not only revealed the molecular basis of ACT biosynthesis but also provided new insights into the potential pathways that the phytopathogen A. alternata copes with oxidative stress.