Ustilago maydis causes common smut in maize, which is characterized by tumor formation in aerial parts of maize. Tumor comes from the de novo cell division of highly developed bundle sheath and subsequent cell enlargement. However, its mechanism is still unknown. Here, we characterize the U. maydis effector Sts2 (Small tumor on seedlings 2), which promotes the division of hyperplasia tumor cells. Upon infection, Sts2 is translocated into maize cell nucleus, where it acts as a transcriptional activator, and the transactivation activity is crucial for its virulence function. Sts2 interacts with ZmNECAP1, a yet undescribed plant transcriptional activator, and it activates the expression of several leaf developmental regulators to potentiate tumor formation. Contrary, a suppressive Sts2-SRDX inhibits the tumor formation by SG200 in a dominant negative way, underpinning the central role of Sts2 for tumorigenesis. Our results not only disclosed the virulence mechanism of a tumorigenic effector, but also revealed the essential role of leaf developmental regulators in pathogen-induced tumor formation.