[Background] Apple tree canker is one of the destructive diseases that caused by Valsa mali in many apple production areas of China with the characteristics of widespread distribution, serious damage, and was difficulty in controlling. Also, the disease of apple tree canker that has been severely restricted the development of apple industry. Therefore, it is urgent to develop an effective measure in control of apple tree canker disease. [Objective] To determine the taxonomic position of antagonistic Z-12A strain that has been isolated from the rhizosphere soil of apple trees in Jingning, Gansu province; and evaluate the biocontrol potential of Z-12A against V. mali in vitro. [Methods] The species of the Z-12A strain and the biological characteristics were identified and determined by the combination of morphological characteristics and ITS sequence analysis, and the plate growth rate method, respectively. the inhibitory efficiency of Z-12A against the pathogens growth was evaluated by dual culture and colony diameter assay, and the detached apple twigs method in vitro. the biosafety on apple branches and mice was determined using the Z-12A strain and its fermented broth, respectively. [Results] The strain of Z-12A was identified as Penicillium egyptiacums using the morphological characteristics and ITS sequence analysis. SDYA and GA were screened as the optimum media for the Z-12A strain hypha growth and spores production, respectively. Xylose and KNO3 were screened as the optimum carbon and nitrogen sources, respectively. The optimum pH and temperatures for hypha growth were at 5.0 and at 25 °C, and 7.0 and 10 °C for spores production. The inhibitory rates of Z-12A strain against V. mali was 88.71% and 61.07% using the plate confrontation and fermentation broth, respectively. Microscopic observation showed that the strain of Z-12A can make the mycelium of V. mali deformity and cell protoplast exosmosis. Additionally, the control efficacy of Z-12A fermentation broth was 66.69% after application in apple twigs in vitro, and also was safe for apple branches and mice after application. [Conclusion] These results indicate that the strain of Z-12A has strong inhibitory activity against V. mali, and exhibited significant bio-control potential in vitro. Thus, our results provide a new bio-control resource in controlling apple tree canker disease in future.