Terpenoid phytoalexins function as defense compound against a broad spectrum of pathogens and pests in the plant kingdom. However, the role of phytoalexin in antiviral defense is still elusive. In this study, we identified the biosynthesis pathway of a sesquiterpenoid phytoalexin, capsidiol 3-acetate as an antiviral response against RNA virus Potato Virus X (PVX) in Nicotiana benthamiana. NbTPS1 and NbEAH genes were found strongly induced by PVX-infection. Enzymatic activity and genetic evidence indicated that both genes were involved in the PVX-induced biosynthesis of capsidiol 3-acetate. NbTPS1- or NbEAH-silenced plant was more susceptible to PVX. The accumulation of capsidiol 3-acetate in PVX-infected plant was partially regulated by jasmonic acid signaling receptor COI1. These findings provide an insight into a novel mechanism of how plant uses the basal arsenal machinery to mount a fight against virus attack even in susceptible species.