Phosphate solubilising microorganisms (PSM) play an important role in plant nutrition through the increase in phosphorus uptake by the plant and also as plant growth promoting microbes as an important contributor to the biofertilization of agricultural crops. Efficient PSM strains, Pseudomonas fluorescens and Bacillus megaterium were isolated from rhizosphere soil. These test isolates were biochemically characterized and cultivated in low cost medium containing fish extract as the major protein source and were found to grow effectively. Further they were screened in vitro for their phosphate solubilisation and plant growth promoting traits like production of indoleacetic acid (IAA), protease and hydrogen cyanide (HCN). Antifungal activity of P. fluorescens and B. megaterium were tested against the plant pathogen Fusarium sp. in in vitro.