Dwarfism is one of the most valuable traits in watermelon breeding mainly because of its contribution to yield as well as the decreased labor required to cultivate and harvest smaller plants. However, the underlying genetic mechanism is unknown. In this study, a candidate dwarfism gene was identified by applying next-generation sequencing technology to analyze watermelon plants. We completed a whole-genome re-sequencing of two DNA bulks (dwarf pool and vine pool) generated from plants in an F2 population. A genome-wide analysis of single nucleotide polymorphisms resulted in the detection of a genomic region harboring the candidate dwarfism gene Cla010726. The encoded protein was predicted to be a gibberellin 20-oxidase-like protein, which is a well-known "green revolution" protein in other crops. A quantitative real-time PCR investigation revealed that the Cla010726 expression level was significantly lower in the dwarf plants than in the normal-sized plants. The SNP analysis resulted in two SNP locating in the Cla010726 gene promoter of dsh F2 individuals. The results presented herein provide preliminary evidence that Cla010726 is a possible dwarfism gene.