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Anthracnose caused by <i>Colletotrichum acutatum</i> is one of the most devastating fungal diseases of pepper (<i>Capsicum annuum</i> L.). The utilization of chitin-binding proteins or chitinase genes is the best option to control this disease. A chitin-binding domain (CBD) has been shown to be crucial for the innate immunity of plants and activates the hypersensitive response (HR). The <i>CaChiIII7</i> chitinase gene has been identified and isolated from pepper plants. <i>CaChiIII7</i> has repeated CBDs that encode a chitinase enzyme that is transcriptionally stimulated by <i>C. acutatum</i> infection. The knockdown of <i>CaChiIII7</i> in pepper plants confers increased hypersensitivity to <i>C. acutatum</i>, resulting in its proliferation in infected leaves and an attenuation of the defense response genes <i>CaPR1</i>, <i>CaPR5</i>, and <i>SAR8.2</i> in the <i>CaChiIII7</i>-silenced pepper plants. Additionally, H₂O₂ accumulation, conductivity, proline biosynthesis, and root activity were distinctly reduced in <i>CaChiIII7</i>-silenced plants. Subcellular localization analyses indicated that the <i>CaChiIII7</i> protein is located in the plasma membrane and cytoplasm of plant cells. The transient expression of <i>CaChiIII7</i> increases the basal resistance to <i>C. acutatum</i> by significantly expressing several defense response genes and the HR in pepper leaves, accompanied by an induction of H₂O₂ biosynthesis. These findings demonstrate that <i>CaChiIII7</i> plays a prominent role in plant defense in response to pathogen infection.