Dynamic of plant-parasitic nematodes population in soil is closely related to soil microorganisms. Fungi from Heterodera zeae cysts were isolated to explore the natural decline phenomenon of H. zeae population. A polyphasic method was used to identify the nematode-destroying fungal, including phylogenetic analysis of partial ITS, BenA, CaM, and RPB2 gene sequences, as well as macro- and micro-morphological analyses. The nematicidal activity of strain GX1 against H. zeae was assessed in vitro and greenhouse. Our findings revealed that strain GX1 is a novel species of Talaromyces, which named Talaromyces cystophila. It had strong parasitic and lethal effect on the H. zeae cysts with 91.11% parasitism on cysts at 3 d after treatment, and second-stage juveniles (J2s) and eggs inside the cysts appeared dense vacuoles and loss of vitality. The spore suspension and fermentation filtrate of T. cystophila inhibited significantly the hatching of H. zeae eggs and showed potential nematicidal activities on J2s. The hatching inhibition rates of eggs exposed to 1 × 108 cfu/ml spore suspensions or 20% 1-week fermentation filtrate (1-WF) for 15 days were 98.56% and 100%, respectively. The mortality of J2s exposed to 1 × 108 cfu/ml spore suspension reached 100% at 24 h, exposure to 50% 2-WF was 98.65% and 100% at 24 h and 48 h, respectively. Greenhouse experiments revealed that the spore suspension and fermentation broth considerably decreased H. zeae reproduction by 56.17%-78.76%. T. Cystophila is a potential biocontrol strain with parasitic and nematicidal activity, which deserves attention and application.