Aims: To optimize the medium components for the production of indole-3-acetic acid (IAA) by isolated bacterium Pantoea agglomerans strain PVM. Methods and Results: Present study deals with the production of an essential plant hormone IAA by a bacterial isolate P. agglomerans strain PVM identified by 16S rRNA gene sequence analysis. The medium containing 8 g l-1 of meat extract and 1 g l-1 of l-tryptophan (precursor) at optimum pH 7, 30 degrees C and 48-h incubation gave the maximum production of IAA (2 center dot 191 g l-1). Effect of IAA synthesized on in vitro root induction in Nicotiana tobacum (leaf) explants was compared with that of control. IAA was characterized by high-performance thin-layer chromatography, high-performance liquid chromatography and gas chromatography-mass spectroscopy. Conclusions: Pantoea agglomerans strain PVM was a good candidate for the inexpensive and utmost production of IAA in short period, as it requires simple medium (meat extract and l-tryptophan). Significance and Impact of the Study: The present report first time showed the rapid, cost-effective and maximum production of IAA. No reports are available on the optimization of particular medium components for the production of IAA. This study demonstrates a novel approach for in vitro root induction in N. tobacum (leaf) explants.