The nature of the interaction between magnetism and topology in magnetic topological semimetals remains mysterious, but may be expected to lead to a variety of novel physics. We present $ab$ $initio$ band calculations, electrical transport and angle-resolved photoemission spectroscopy (ARPES) measurements on the magnetic semimetal EuAs$_3$, demonstrating a magnetism-induced topological transition from a topological nodal-line semimetal in the paramagnetic or the spin-polarized state to a topological massive Dirac metal in the antiferromagnetic (AFM) ground state at low temperature, featuring a pair of massive Dirac points, inverted bands and topological surface states on the (010) surface. Shubnikov-de Haas (SdH) oscillations in the AFM state identify nonzero Berry phase and a negative longitudinal magnetoresistance ($n$-LMR) induced by the chiral anomaly, confirming the topological nature predicted by band calculations. When magnetic moments are fully polarized by an external magnetic field, an unsaturated and extremely large magnetoresistance (XMR) of $sim$ 2$times10^5$ % at 1.8 K and 28.3 T is observed, likely arising from topological protection. Consistent with band calculations for the spin-polarized state, four new bands in quantum oscillations different from those in the AFM state are discerned, of which two are topologically protected. Nodal-line structures at the $Y$ point in the Brillouin zone (BZ) are proposed in both the spin-polarized and paramagnetic states, and the latter is proven by ARPES. Moreover, a temperature-induced Lifshitz transition accompanied by the emergence of a new band below 3 K is revealed. These results indicate that magnetic EuAs$_3$ provides a rich platform to explore exotic physics arising from the interaction of magnetism with topology.
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