BackgroundMicrobial growth during plant tissue culture is a common problem that causes significant losses in the plant micro-propagation system. Most of these endophytic microbes have the ability to propagate through horizontal and vertical transmission. On the one hand, these microbes provide a rich source of several beneficial metabolites.ResultsThe present study reports on the isolation of fungal species from different in vitro medicinal plants (i.e., Breynia disticha major, Breynia disticha, Duranta plumieri, Thymus vulgaris, Salvia officinalis, Rosmarinus officinalis, and Ocimum basilicum l) cultures. These species were tested for their indole acetic acid (IAA) production capability. The most effective species for IAA production was that isolated from Thymus vulgaris plant (11.16 µg/mL) followed by that isolated from sweet basil plant (8.78 µg/mL). On screening for maximum IAA productivity, medium, “MOS + tryptophan” was chosen that gave 18.02 μg/mL. The macroscopic, microscopic examination and the 18S rRNA sequence analysis indicated that the isolate that given code T4 was identified as Neopestalotiopsis aotearoa (T4). The production of IAA by N. aotearoa was statistically modeled using the Box-Behnken design and optimized for maximum level, reaching 63.13 µg/mL. Also, IAA extract was administered to sweet basil seeds in vitro to determine its effect on plant growth traits. All concentrations of IAA extract boosted germination parameters as compared to controls, and 100 ppm of IAA extract exhibited a significant growth promotion effect for all seed germination measurements.ConclusionsThe IAA produced from N. aotearoa (T4) demonstrated an essential role in the enhancement of sweet basil (Ocimum basilicum) growth, suggesting that it can be employed to promote the plant development while lowering the deleterious effect of using synthetic compounds in the environment.