Phascolosoma esculenta is an economically species inhabiting a soft substrate of mud in the intertidal zone, which is bad breathability, especially during the prolonged heavy rainstorms, that will bring hypoxia environment to P. esculenta. In this study, the negative impact of hypoxia on P. esculenta was firstly studied. The results showed that there were no P. esculenta died post 7 days hypoxia. However, P. esculenta surface became black after hypoxia stress and changed to brown after reoxygenation. The body cavity fluid’s total antioxidant capacity (T-AOC) showed notable increases at 48 h, 120 h, and 168 h post hypoxia stress and returned to the control level after reoxygenation. The contents of malondialdehyde (MDA) increased significantly at 24 h, 48 h, and 96 h but decreased substantially after reoxygenation. The activity of lactate dehydrogenase (LDH) increased during the hypoxia but decreased significantly after reoxygenation. Transcriptomic analysis was performed and a total of 55.26 GB of clean data were collected, 362 DEGs were obtained based on FPKM values, including 77 DEGs between control and hypoxia groups, 48 DEGs between control and reoxygenation groups, and 237 DEGs between hypoxia and reoxygenation groups. DEGs are enriched in pathways associated with immune system, carbon metabolism, apoptosis, ribosome and ion transport. These data enriched the molecular mechanism of invertebrate hypoxia tolerance and provided genetic material reference for future breeding of hypoxia-tolerant P. esculenta and other aquatic species.