Microsporidia are obligate intracellular parasites with the smallest known eukaryotic genomes. Although they are increasingly recognized as economically and medically important parasites, the molecular basis of microsporidian pathogenicity is almost completely unknown and no genetic manipulation system is currently available. The fish-infecting microsporidian Spraguea lophii shows one of the most striking host cell manipulations known for these parasites, converting host nervous tissue into swollen spore factories known as xenomas. In order to investigate the basis of these interactions between microsporidian and host, we sequenced and analyzed the S. lophii genome. Although, like other microsporidia, S. lophii has lost many of the protein families typical of model eukaryotes, we identified a number of gene family expansions including a family of leucine-rich repeat proteins that may represent pathogenicity factors. Building on our comparative genomic analyses, we exploited the large numbers of spores that can be obtained from xenomas to identify potential effector proteins experimentally. We used complex-mix proteomics to identify proteins released by the parasite upon germination, resulting in the first experimental isolation of putative secreted effector proteins in a microsporidian. Many of these proteins are not related to characterized pathogenicity factors or indeed any other sequences from outside the Microsporidia. However, two of the secreted proteins are members of a family of RICIN B-lectin-like proteins broadly conserved across the phylum. These proteins form syntenic clusters arising from tandem duplications in several microsporidian genomes and may represent a novel family of conserved effector proteins. These computational and experimental analyses establish S. lophii as an attractive model system for understanding the evolution of host-parasite interactions in microsporidia and suggest an important role for lineage-specific innovations and fast evolving proteins in the evolution of the parasitic microsporidian lifecycle.