Understanding how fungi specialize on their plant host is crucial for developing sustainable disease control. A traditional, centuries-old rice agro-system of the Yuanyang terraces was used as a model to show that virulence effectors of the rice blast fungus Magnaporthe oryzaeh play a key role in its specialization on locally grown indica or japonica local rice subspecies. Our results have indicated that major differences in several components of basal immunity and effector-triggered immunity of the japonica and indica rice varieties are associated with specialization of M. oryzae. These differences thus play a key role in determining M. oryzae host specificity and may limit the spread of the pathogen within the Yuanyang agro-system. Specifically, the AVR-Pia effector has been identified as a possible determinant of the specialization of M. oryzae to local japonica rice.