To better understand the behavior of Xanthomonas axonopodis pv. glycines, the causal agent of bacterial pustule of soybean within its host, its global transcriptome within soybean leaves was compared with that in a minimal medium in vitro, using deep sequencing of mRNA. Of 5,062 genes predicted from a draft genome of X. axonopodis pv. glycines, 534 were up-regulated in the plant, while 289 were down-regulated. Genes encoding YapH, a cell-surface adhesin, as well as several others encoding cell-surface proteins, were down-regulated in soybean. Many genes encoding the type III secretion system and effector proteins, cell wall-degrading enzymes and phosphate transporter proteins were strongly expressed at early stages of infection. Several genes encoding RND multidrug efflux pumps were induced in planta and by isoflavonoids in vitro and were required for full virulence of X. axonopodis pv. glycines, as well as resistance to soybean phytoalexins. Genes encoding consumption of malonate, a compound abundant in soybean, were induced in planta and by malonate in vitro. Disruption of the malonate decarboxylase operon blocked growth in minimal media with malonate as the sole carbon source but did not significantly alter growth in soybean, apparently because genes for sucrose and fructose uptake were also induced in planta. Many genes involved in phosphate metabolism and uptake were induced in planta. While disruption of genes encoding high-affinity phosphate transport did not alter growth in media varying in phosphate concentration, the mutants were severely attenuated for growth in soybean. This global transcriptional profiling has provided insight into both the intercellular environment of this soybean pathogen and traits used by X. axonopodis pv. glycines to promote disease.