Homologs of the Yersinia virulence factor YopJ are found in both animal and plant bacterial pathogens, as well as in plant symbionts. The conservation of this effector family indicates that several pathogens may use YopJ-like proteins to regulate bacteria-host interactions during infection. YopJ and YopJ-like proteins share structural homology with cysteine proteases and are hypothesized to functionally mimic small ubiquitin-like modifier (SUMO) proteases in eukaryotic cells. Strains of the phytopathogenic bacterium Xanthomonas campestris pv. vesicatoria are known to possess four YopJ-like proteins, AvrXv4, AvrBsT, AvrRxv, and XopJ. In this work, we have characterized AvrXv4 to determine if AvrXv4 functions like a SUMO protease in planta during Xanthomonas-plant interactions. We provide evidence that X. campestris pv. vesicatoria secretes and translocates the AvrXv4 protein into plant cells during infection in a type III-dependent manner. Once inside the plant cell, AvrXv4 is localized to the plant cytoplasm. By performing AvrXv4 deletion and mutational analysis, we have identified amino acids required for type III delivery and for host recognition. We show that AvrXv4 recognition by resistant plants requires a functional protease catalytic core, the domain that is conserved in all of the putative YopJ-like cysteine proteases. We also show that AvrXv4 expression in planta leads to a reduction in SUMO-modified proteins, demonstrating that AvrXv4 possesses SUMO isopeptidase activity. Overall, our studies reveal that the YopJ-like effector AvrXv4 encodes a type III SUMO protease effector that is active in the cytoplasmic compartment of plant cells.