Endophytes are micro-organisms including bacteria and fungi that survive within healthy plant tissues and promote plant growth under stress. This review focuses on the potential of endophytic microbes that induce abiotic stress tolerance in plants. How endophytes promote plant growth under stressful conditions, like drought and heat, high salinity and poor nutrient availability will be discussed. The molecular mechanisms for increasing stress tolerance in plants by endophytes include induction of plant stress genes as well as biomolecules like reactive oxygen species scavengers. This review may help in the development of biotechnological applications of endophytic microbes in plant growth promotion and crop improvement under abiotic stress conditions.Increasing human populations demand more crop yield for food security while crop production is adversely affected by abiotic stresses like drought, salinity and high temperature. Development of stress tolerance in plants is a strategy to cope with the negative effects of adverse environmental conditions. Endophytes are well recognized for plant growth promotion and production of natural compounds. The property of endophytes to induce stress tolerance in plants can be applied to increase crop yields. With this review, we intend to promote application of endophytes in biotechnology and genetic engineering for the development of stress-tolerant plants.