Plant-associated actinobacteria are rich sources of bioactive compounds including indole-derived molecules such as phytohormone indole-3-acetic acid (IAA). In view of few investigations concerning the biosynthesis of IAA by endophytic actinobacteria, this study evaluated the potential of IAA production in endophytic streptomycete isolates sourced from medicinal plant species Taxus chinensis and Artemisia annua. By HPLC analysis of IAA combined with molecular screening approach of iaaM, a genetic determinant of streptomycete IAA synthesis via indole-3-acetamide (IAM), our data showed the putative operation of IAM-mediated IAA biosynthesis in Streptomyces sp. En-1 endophytic to Taxus chinensis. Furthermore, using the co-cultivation system of model plant Arabidopsis thaliana and streptomycete, En-1 was found to be colonized intercellularly in the tissues of Arabidopsis, an alternative host, and the effects of endophytic En-1 inoculation on the model plant were also assayed. The phytostimulatory effects of En-1 inoculation suggest that IAA-producing Streptomyces sp. En-1 of endophytic origin could be a promising candidate for utilization in growth improvement of plants of economic and agricultural value.