Abstract: Bacillus velezensis TCS001 is a novel biocontrol bacterium from marine habitat. This study investigated the inhibitory effects of lipopeptides produced by TCS001 on 17 plant pathogens through mycelial growth-rate assay, and the underlying anti-fungal mechanisms were preliminarily explored with Botrytis cinerea. Results showed that the inhibitory rates of TCS001 lipopeptides against 17 plant pathogens ranged from 56.45% to 97.15%. The inhibitory rates to Botryosphaeria dothidea (causing Carya cathayensis canker disease), Macrophoma kawatsukai, Sclerotinia sclerotiorum, Bipolaris sorokiniana, and Botrytis cinerea, were 97.15%, 94.87%, 92.64%, 91.04%, and 89.55%, respectively. Pot test and optical microscope observation demonstrated that lipopeptides could limit B. cinerea growth in vivo and have teratogenic effect on hypha. The fermentation conditions for optimal lipopeptides production of TCS001 were determined by a single-factor experiment combined with response surface methodology. The three key factors that affected lipopeptide production most were the nitrogen source, carbon source, and fermentation temperature. The optimized fermentation conditions were as follows: soluble starch 10.5 g/L, peanut cake powder 18.5 g/L, NaCl 3.0 g/L, liquid volume 32%, inoculum volume 3%, fermentation pH 6.0, fermentation temperature 31 °C, seed age 16 h, rotation speed 164 r/min, fermentation time 48 h. There is a good fit between the predicted values and the actual values of the response surface. The actual yield of lipopeptides increased to 0.653 g/L, which was 1.59 times that of 0.41 g/L before optimization. The results lay a foundation for the subsequent development of TCS001 and provide a theoretical basis.