Surveillance of the extracellular environment by immune receptors is of central importance to eukaryotic survival. The rice receptor kinase XA21, which confers robust resistance to most strains of the Gram-negative bacterium Xanthomonas oryzae pv. oryzae (Xoo), is representative of a large class of cell surface immune receptors in plants and animals. We report the identification of a previously undescribed Xoo protein, called RaxX, which is required for activation of XA21-mediated immunity. Xoo strains that lack RaxX, or carry mutations in the single RaxX tyrosine residue (Y41), are able to evade XA21-mediated immunity. Y41 of RaxX is sulfated by the prokaryotic tyrosine sulfotransferase RaxST. Sulfated, but not nonsulfated, RaxX triggers hallmarks of the plant immune response in an XA21-dependent manner. A sulfated, 21-amino acid synthetic RaxX peptide (RaxX21-sY) is sufficient for this activity. Xoo field isolates that overcome XA21-mediated immunity encode an alternate raxX allele, suggesting that coevolutionary interactions between host and pathogen contribute to RaxX diversification. RaxX is highly conserved in many plant pathogenic Xanthomonas species. The new insights gained from the discovery and characterization of the sulfated protein, RaxX, can be applied to the development of resistant crop varieties and therapeutic reagents that have the potential to block microbial infection of both plants and animals.