A copper-tolerant phenanthrene (PHE)-degrading bacterium, strain Sphingobium sp. PHE-1, was newly isolated from the activated sludge in a wastewater treatment plant. Two key genes, ahdA1b-1 encoding polycyclic aromatic hydrocarbon ring-hydroxylating dioxygenase (PAH-RHDɑ) and xyLE encoding catechol-2,3-dioxygenase (C23O), involved in the PHE metabolism by strain PHE-1 were identified. The PAH-RHD gene cluster showed 96% identity with the same cluster of Sphingomonas sp. P2. Our results indicated the induced transcription of xylE and ahdA1b-1 genes by PHE, simultaneously promoted by Cu(II). For the first time, high concentration of Cu(II) is found to encourage the expression of PAH-RHDɑ and C23O genes during PHE degradation. Applying Sphingomonas PHE-1 in PHE-contaminated soils for bioaugmentation, the abundance of xylE gene was increased by the planting of ryegrass and the presence of Cu(II), which, in turn, benefited ryegrass growth. The best performance of PHE degradation and the highest abundance of xylE genes occurred in PHE-copper co-contaminated soils planted with ryegrass.