Phytonematodes cause severe yield losses in horticulture, partly because they are difficult to manage. Compact, energy-efficient generators that electrochemically produce ozonated water by utilizing diamond-coated electrodes have become available. In this study, the application of on-site generated ozonated water to inactivate soil nematodes and to mitigate nematode-mediated apple replant disease was tested. Pratylenchus penetrans was highly susceptible to dissolved ozone (LC50 0.6 mg L−1). In one greenhouse experiment, treatment of P. penetrans in soil with ozonated water (0.27 mg ozone L−1 soil) reduced subsequent invasion of the nematodes into roots by 60%. Growth of apple saplings in soil that was affected by apple replant disease (ARD) was significantly improved following a treatment with 1/10 volume ozonated water compared to the control. In a second greenhouse experiment, one-time drenching of ARD soil with ozonated water was followed by improved growth of apple plants similar to that in autoclaved soil. A second application of ozonated water did not further improve plant growth. The number of active nematodes in replanted soil that moved through a Baermann filter was significantly reduced by all tested concentrations of ozone (0.12–0.75 mg L−1 soil). A fraction of 19–36% of the nematodes survived and slightly recovered after four weeks. In conclusion, on-site generated ozonated water has potential to mitigate nematode problems in horticulture and to expand management options.