Summary Phytophthora spp. cause serious damage to plants by exploiting a large number of effector proteins and small RNAs (sRNAs). Several reports have described modulation of host RNA biogenesis and defence gene expression. Here, we analysed Phytophthora infestans Argonaute (Ago) 1 associated small RNAs during potato leaf infection. Small RNAs were co‐immunoprecipitated, deep sequenced and analysed against the P. infestans and potato genomes, followed by transcript analyses and transgenic assays on a predicted target. Extensive targeting of potato and pathogen‐derived sRNAs to a range of mRNAs was observed, including 638 sequences coding for resistance (R) proteins in the host genome. The single miRNA encoded by P. infestans (miR8788) was found to target a potato alpha/beta hydrolase‐type encoding gene (StABH1), a protein localized to the plasma membrane. Analyses of stable transgenic potato lines harbouring overexpressed StABH1 or artificial miRNA gene constructs demonstrated the importance of StABH1 during infection by P. infestans. miR8788 knock‐down strains showed reduced growth on potato, and elevated StABH1 expression levels were observed when plants were inoculated with the two knock‐down strains compared to the wild‐type strain 88069. The findings of our study suggest that sRNA encoded by P. infestans can affect potato mRNA, thereby expanding our knowledge of the multifaceted strategies this species uses to facilitate infection.