The beet cyst nematode Heterodera schachtii causes major yield losses in sugar beet. Understanding the interaction between H. schachtii and its host plant is important for developing a sustainable management system. Nematode effectors play a crucial role in initializing and sustaining successful parasitism. In our study, we identified a gene (Hs-Tyr) encoding a tyrosinase functional domain (PF00264). We describe Hs-Tyr as a novel nematode effector. Hs-Tyr is localized in the nematode esophageal gland. Up-regulation of its expression coincided with the parasitic developmental stages of the nematode. Silencing Hs-Tyr by RNA interference made the treated nematodes less virulent. When RNAi-treated nematodes succeeded in infecting the plant, developing females and their associated syncytial nurse cells were significantly smaller than in control plants. Ectopically expressing the Hs-Tyr effector in Arabidopsis increased plant susceptibility to H. schachtii, but not to the root-knot nematode Meloidogyne incognita. Interestingly, Hs-Tyr in the plant promoted plant growth and changed the root architecture. Additionally, the expression of Hs-Tyr in Arabidopsis caused changes in the homeostasis of several plant hormones especially auxin and the ethylene precursor aminocyclopropane-carboxylic acid.