Background Auxin production by bacteria is one of the most important direct mechanisms utilized by plant growth-promoting bacteria (PGPB) for the betterment of plants naturally because auxin is a plant friendly secondary metabolite synthesized naturally by bacteria, and hence improves the growth of associated plants. So, the current study focuses on bacterial synthesis of Indole-3-acetic acid (IAA) for plant growth improvement. Methods In the current study, the PGPB were selected on the basis of their auxin production potential and their growth promoting attributes were evaluated. Indole-3-acetic acid producing potential of two selected bacterial isolates was observed by varying different growth conditions i.e., media composition, carbon sources (glucose, sucrose and lactose) and different concentrations of precursor. Influence of various physiological factors (temperature and incubation time period) on IAA production potential was also evaluated. Results Both the bacterial strains Bacillus cereus (So3II) and B. subtilis (Mt3b) showed variable potential for the production of bacterial IAA under different set of growth and environmental conditions. Hence, the IAA production potential of the bacterial isolates can be enhanced by affecting optimum growth conditions for bacterial isolates and can be used for the optimal production of bacterial IAA and its utilization for plant growth improvement can lead to better yield in an eco-friendly manner.