The success of silkworm crop depends on many factors. The good quality mulberry leaf, larval spacing, aeration, protection from disease and pests etc. Many silkworm diseases are caused due to the infection of various bacteria, virus, fungus etc. Diseases such as sotto, flacherie and septicemia are caused due to bacterial infection. In the present investigation, flacherie disease is caused by E. coli. In this study, the leaf extract containing biologically active ingradients from a medicinal plant, Keelanelli (Phyllanthus niruri) was tested for potential in improving the morphology, haemocyte count and economic parameters of silkworm, B. mori. Haemocyte count was significantly increased in the 5µl E. coli inoculated and treated with (6hrs) P. niruri to B. mori larvae. The economic characters of the silkworm viz., shell weight, cocoon weight and shell ratio were also improved by the topical application of plant extract. This study report suggested that the flacherie disease (E. coli) infected silkworm treated with P. niruri plant extract provide significant improvement in cocoon parameters.