Recently bamboo has gained reputation as a major resource of non-wood fiber. The present study was undertaken to generate information about fiber development process in bamboo (Bambusa balcooa) using PCR-based suppressive subtractive hybridization (PCR-SSH) technique, as molecular mechanism of its fiber development is yet to be explored. SSH was performed between cDNA isolated from leaf (as driver) and internodes (as tester) of B. balcooa which indicated up-regulation of 521 ESTs. Among these 41 were contigs and 65 ESTs were singletons. On the basis of BLASTX search 307 ESTs with known functions were classified into several functional categories including transport, metabolism, information, perception and response to stimuli while others were either non-significant (120) or hypothetical proteins (94). A total of 51 out of 307 functional ESTs were found fiber specific and their global distribution among different plant species like maize, rice, cotton and Arabidopsis ESTs were determined. Net distributions and differential expression patterns of 13 important B. balcooa fiber specific cDNAs among different internodes during bamboo development were studied using RNA slot-blot, semi-quantitative RT-PCR and real time PCR. In-situ localization of mRNA transcript for few selected bamboo fiber ESTs namely, V1Bb147 (protein kinase-like protein) and V1Bb88 (myb domain-containing protein) were detected using Confocal Laser Scanning Microscope. Transcript levels of these genes exhibited an orchestral turn-over during bamboo development, suggesting their close association with fiber development, an event associated with several metabolic and physiological changes. The results clearly suggest that these genes are involved in several concerted mechanisms involving Ca(+) signaling pathway, cell wall synthesis, hormone regulation, system maintaining cell turgor pressure and cytoskeleton synthesis pathway accountable for bamboo fiber development signifying fiber development as a complex but ordered metabolic process involving differential expression of large scale fiber associated genes. This is the first report on systematic analysis of genes involved in bamboo fiber development.