The endoparasitic fungus Hirsutella rhossiliensis is an important biocontrol agent of cyst nematodes in nature. To determine the potential parasitism of the fungus on a non-natural host, the pinewood nematode (Bursaphelenchus xylophilus) living in pine trees and the endophytic ability of the fungus on plants, in this paper, we first constructed and utilized a green fluorescent protein (GFP)-tagged H. rhossiliensis HR02 transformant to observe the fungal infection process on B. xylophilus and its colonization on Arabidopsis roots. Then, we compared the fungal parasitism on three species of nematodes with different lifestyles, and we found that the fungal parasitism is correlated with nematode species and stages. The parasitic effect of H. rhossiliensis on adults of B. xylophilus is similar to that on second-stage juveniles (J2) of the root-knot nematode Meloidogyne incognita after 24 h of inoculation, although the virulence of the fungus to second-stage juveniles of M. incognita is stronger than that to those of B. xylophilus and Caenorhabditis elegans. Moreover, the endophytism of H. rhossiliensis was confirmed. By applying an appropriate concentration of H. rhossiliensis conidial suspension (5 × 106 spores/mL) in rhizosphere soil, it was found that the endophytic fungus can promote A. thaliana growth and reproduction, as well as improve host resistance against M. incognita. Our results provide a deeper understanding of the fungus H. rhossiliensis as a promising biocontrol agent against plant-parasitic nematodes.