Streptococcus suis, an emerging infectious pathogen, is the cause of two large-scale outbreaks of human streptococcal toxic shock syndrome in China, and has attracted much attention from the scientific community. The genetic basis of its pathogenesis remains enigmatic, and no effective prevention measures have been established. To better understand the virulence differentiation of S. suis and develop a promising vaccine, we isolated and sequenced a native avirulent S. suis strain (05HAS68). Animal experiments revealed that 05HAS68 is an avirulent strain and could protect piglets from the attack of virulent strains. Comparative genomics analyses demonstrated the genetic basis for the lack of virulence in 05HAS68, which is characterized by the absence of some important virulence-associated factors and the intact 89K pathogenicity island. Lack of virulence was also illustrated by reduced survival of 05HAS68 compared to a virulent strain in pig whole blood. Further investigations revealed a large-scale genomic rearrangement in 05HAS68, which was proposed to be mediated by transposase genes and/or prophages. This genomic rearrangement may have caused the genomic diversity of S. suis, and resulted in biological discrepancies between 05HAS68 and highly virulent S. suis strains.