Tumor endothelial marker 1 (TEM1) has been identified as a novel surface marker upregulated on the blood vessels and stroma in many solid tumors. We previously isolated a novel single-chain variable fragment (scFv) 78 against TEM1 from a yeast display scFv library. Here we evaluated the potential applications of scFv78 as a tool for tumor molecular imaging, immunotoxin-based therapy and nanotherapy. Epitope mapping, three-dimensional (3D) structure docking and affinity measurements indicated that scFv78 could bind to both human and murine TEM1, with equivalent affinity, at a well-conserved conformational epitope. The rapid internalization of scFv78 and scFv78-labeled nanoparticles was triggered after specific TEM1 binding. The scFv78-saporin immunoconjugate also exerted dose-dependent cytotoxicity with high specificity to TEM1-positive cells in vitro. Finally, specific and sensitive tumor localization of scFv78 was confirmed with optical imaging in a mouse tumor model that has highly endogenous mTEM1 expression in the vasculature. Our data indicate that scFv78, the first fully human anti-TEM1 recombinant antibody, recognizes both human and mouse TEM1 and has unique and favorable features that are advantageous for the development of imaging probes or antibody-toxin conjugates for a large spectrum of human TEM1-positive solid tumors.