Streptococcus dysgalactiae subsp. equisimilis (SDSE) has emerged as an important cause of severe skin and soft tissue infections, but little is known of the pathogenic mechanisms underlying tissue pathology. Patient samples and a collection of invasive and non-invasive group G SDSE strains (n = 69) were analyzed with respect to virulence factor expression and cytotoxic or inflammatory effects on human cells and 3D skin tissue models. SDSE strains efficiently infected the 3D-skin model and severe tissue pathology, inflammatory responses and altered production of host structural framework proteins associated with epithelial barrier integrity were evident already at 8 hours post-infection. Invasive strains were significantly more cytotoxic towards keratinocytes and expressed higher Streptokinase and Streptolysin O (SLO) activities, as compared to non-invasive strains. The opposite was true for Streptolysin S (SLS). Fractionation and proteomic analysis of the cytotoxic fractions implicated SLO as a factor likely contributing to the keratinocyte cytotoxicity and tissue pathology. Analyses of patient tissue biopsies revealed massive bacterial load, high expression of slo, as well as immune cell infiltration and pro-inflammatory markers. Our findings suggest the contribution of SLO to epithelial cytotoxicity and tissue pathology in SDSE tissue infections.