Verticillium dahliae is a soil-borne hemi-biotrophic fungal pathogen and inflicts major losses in agricultural production worldwide. Although the pathogenicity of the fungus and plant immunity have been extensively studied, how cotton leaf necrosis is induced by defoliating strains of V. dahliae is poorly understood. In this study, reference-grade genomes were determined for two representative V. dahliae isolates: V991, which is defoliating and aggressive, and 1cd3-2, which is non-defoliating and has weak pathogenicity. Transcriptome analysis showed that cotton resistance to V. dahliae mainly depends on cell wall structure or physical barrier generation in the early stage of infection (3-9 days post inoculation, dpi). However, a large number of pathogenic factors could be detected from 12 dpi and accumulated quickly in cotton stems, accompanied by the burst of reactive oxygen species (ROS), leaf necrosis and defoliation. A V991 specific virulence gene SP3 was identified through comparative genome analysis and found to be highly expressed after colonization. Knock-out of SP3 clearly attenuated pathogenicity, with less ROS produced. These results indicate that disease symptoms in cotton may be due to abnormal immune activation and excessive ROS induced by the pathogen. To further investigate this, Polyethyleneimine coated MXene quantum dots (PEI-MQDs), a type of nano material that possesses the ability to remove ROS in vitro, were used. Cotton seedlings maintain ROS homeostasis with enhanced peroxidase (POD), catalase (CAT) and glutathione peroxidase (GSH-Px) activities after exogenous treatment with PEI-MQDs and show significant tolerance to V. dahliae isolate V991. Our results suggest that excessive ROS and constitutive immune activation in cotton induced by the defoliating strain of V. dahliae is responsible for disease symptoms such as leaf necrosis, and PEI-MQDs application improve cotton tolerance to V. dahliae by maintaining ROS homeostasis.